Big tech ETF rewards Nvidia and punishes Apple

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Written By Maya Cantina

New Weightings: Major Tech ETF Rewards Nvidia, Punishes Apple

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Nvidia will soon reach a 21 percent weighting in a major technology ETF. This is several times the previous share. Apple, on the other hand, will drop to 4.5 percent. This move is likely to further boost Nvidia stock.

The continued price increases of Nvidia shares are prompting a major exchange-traded technology fund (ETF) to increase its weighting in Nvidia shares. To do this, the ETF “The Technology-Selekt-SPDR-Fond (XLK)” acquires Nvidia shares worth more than ten billion dollars (nine billion euros).

NVIDIA Corp. Registered shares DL-.001

In return, the shares of Apple from more than 20 percent to only 4.5 percent. This is a setback for Apple-DIRECTOR Tim cooks, which recently accelerated the pace of Apple’s AI catch-up. It remains to be seen how this “downgrade” will affect the price of Apple stock in the medium term.

The ETF’s future rankings: Microsoft ahead of Nvidia and Apple

The Technology Select Sector SPDR Fund XLKshows the following company ranking in its new composition:

  • Microsoft, new weighting around 21 percent (previously: 22 percent)
  • Nvidia, new weighting around 21 percent (previously: 6 percent)
  • Apple, new weighting 4.5 percent (previously: 22 percent)

According to the report, the new weighting comes from explanations from Matthew Bartolini, head of SPDR Americas Research. Previously, Nvidia’s weighting was limited by the index rules.

The Technology Select Sector SPDR Fund XLK manages $71 billion

“The Technology-Selekt-SPDR-Fund (XLK)” manages investments worth approximately 71 billion dollars (65 billion euros). According to CNBC, a change of 15 percentage points in the ETF corresponds to an investment volume of more than ten billion dollars. The rebalancing should initially apply for one quarter.

Nvidia is getting closer to first place in terms of market value

The AI ​​chip manufacturer Nvidia has been experiencing real price jumps in its shares for months. Nvidia’s current market value corresponds to data from the American technology stock exchange Nasdaq at 3.22 trillion dollars (approximately 2.95 trillion euros). Apple comes to 3.32 trillion dollars (3.04 trillion euros). Microsoft achieves almost exactly the same value. Nvidia is currently in the rankings Third place A.

As a result of the price increases, Nvidia shares have become increasingly expensive. It recently reached four-figure dollar amounts. To keep the share attractive for small investors, Nvidia recently implemented a share split: group CEO Jen-Sen Huang divided the previous shares in a ratio of 1 to 10. This reduced the price of one Nvidia to a tenth.

Currently it is $131.55 (122.72 euros). On June 19, 2023, the price was 38.89 euros. That is an increase of 216 percent within one year. This gives Nvidia an edge over all other “Mag-7” stocks such as Alphabet, AmazonApple, Meta, Microsoft And Tesla in the shadows.

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