Tech stocks have been on a heck of a ride this year. Not enough of a ride to push the PowerShares QQQ Trust ETF to the top of the heap in the Best ETFs for 2018 contest at the midway point, of course.
It’s not that surprising that the QQQ isn’t at the top of its game right now, however. After about two months of a generally strong uptrend, the exchange-traded fund took a nosedive, starting seriously on Jun. 20.
The damage was largely done over increasing fears about what a trade war with China could do to the sector.
While America butted heads with several countries over trade issues, the rhetoric with China garnered the lion’s share of attention.
According to Bloomberg, the current plan could “use one of the most expansive legal tools available to declare China’s investment in U.S. companies involved in technologies such as new-energy vehicles, robotics and aerospace a threat to economic and national security.” These are some big-ticket growth areas.
Can you blame investors for being a little skittish?
That being said, tech is tech. The QQQ ETF is stuffed with solid companies, the sort of large-cap names that are going to keep doing their thing no matter what the trade strife brings.
That said, whether the QQQ ETF can defy the odds and make it to the top of the heap in this contest is going to largely depend on how this trade war fear shakes out and whether the market as a whole succumbs to the recent weakness that has caused quite a few stocks to see red over the last week.
Time will tell. For my part, I still think InvestorPlace readers made a wise choice and am hopeful that I’ll be writing for the winner come the end of 2018.
Jessica Loder is an assistant editor at InvestorPlace.com. As of this writing, she did not hold a position in any of the aforementioned securities.
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