Invesco NASDAQ Internet ETF (NASDAQ:PNQI) focuses on investing in leading tech companies with rapid growth potential. With $751 million in assets and an expense ratio of 0.60%, PNQI offers a diversified portfolio of about 80 positions. While not as well-known as the Invesco QQQ Trust (QQQ), PNQI is managed by the same company and boasts a stronger portfolio, particularly in its top two holdings. Since its inception on June 12, 2008, PNQI has shown promising performance with a price to earnings ratio of nearly 32 times earnings and a forward PE around 26.
The ETF has been on an uptrend since late last year, rallying from $29 to over $40 per share by March 2024. Pullbacks below $40 and especially at the 200-day moving average present attractive opportunities to buy or add to positions. The top three holdings of PNQI include Alphabet (GOOGL), Amazon (AMZN), and Apple (AAPL), each representing a significant portion of the portfolio and offering growth potential in the tech industry.
PNQI has delivered average annual returns of about 14% since inception, with a 1-year total return of 35.61%. Investing in technology stocks makes sense for the long run, given the sector’s high-growth nature and potential for future advancements like AI and humanoid robots. However, potential downside risks include overbought conditions and the impact of rising interest rates on tech stocks.
In summary, PNQI presents an appealing alternative to QQQ, with its focus on Alphabet and Amazon as top holdings offering favorable valuation and growth prospects. Patiently waiting for pullbacks to accumulate shares could be a wise strategy, as tech stocks are expected to rise in the long term. Moreover, notable investors like Anastasia Amoroso have identified PNQI as a top investment choice for the second half of 2024.