Watch Video:
This podcast will highlight a practical and time-efficient process of selecting a well-diversified portfolio of blue-chip and large cap technology companies for our option portfolios. Various exchange-traded funds will be critical in implementing this strategy.
https://thebluecollarinvestor.com/minimembership/bci-investor-program/
——
——
1. Premium Membership:
https://www.thebluecollarinvestor.com/membership/
Best Discounted Packages:
2. BCI Package, our Best and most Comprehensive Investment package:
https://thebluecollarinvestor.com/minimembership/bci-investor-program/
3. TCM Package – BCI Trade Management System:
https://thebluecollarinvestor.com/minimembership/bci-trade-management-system/
4. CEO Package – Includes TMC Package:
https://thebluecollarinvestor.com/minimembership/ceo-package/
5. BCI COURSE & PRODCUTS
https://thebluecollarinvestor.com/store/
6. FIND BCI ON AMAZON
http://amzn.to/Nx2Zqk
Hi Alan,
Is there duplication betweeen QQQ and S&P Technology Select Sector SPDR? Do I need both?
Mark,
What a great question!
The 2 securities are similar, but not precisely the same. XLK contains 67 stocks compared to 100 in QQQ. Over the years, they take turns out-performing each other, but in the long-term XLK has the slight edge. In my personal portfolios, I have favored QQQ because when technology is in favor, QQQ seems to outperform. See the 5-year comparison chart at the bottom of this response.
Now, to your question: There is definitely some overlap and 2 points of view:
1. If technology is in favor, we can take advantage and use both at the risk of being overweighted in technology should the market turn around abruptly.
2. We can use one or the other and enhance the diversification aspect at the expense of, perhaps, lower returns.
Selecting 1 or 2 depends on personal risk tolerance. For most conservative retail investors, #2 is the better approach.
Alan
CLICK ON IMAGE TO ENLARGE & USE THE BACK ARROW TO RETURN TO BLOG.