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Australia Investing
5 Biggest ASX Technology ETFs in 2024
Mar. 05, 2024 10:25AM PST
ASX-listed tech ETFs allow Australian investors access to a variety of global technology stocks.
Blue Planet Studio / Shutterstock
It's indisputable that we're in an era of technology and our technological capabilities are exponentially increasing.
If you aren't reading this on a personal computer or laptop — unthinkable in 1970 — you're probably using a smartphone, and phones that can access the internet have only been around since 1996. For a further example, Apple's (NASDAQ:AAPL) meteoric rise is just as well known and needs no elaboration. The fact of the matter is that technology is integral to our life and advancements in the industry are shaping the future.
For any investor, the tech sector may be a desirable investment opportunity, and ETFs can be a safer way to get into an industry. For those unfamiliar, an ETF, or exchange-traded fund, is a basket of securities that is traded like a stock on an exchange and comes in many different types — market ETFs, foreign market ETFs, commodity ETFs and so on. Advantages include lower expense ratios, diversification and fewer broker commissions. One disadvantage is a low level of liquidity.
Here the Investing News Network looks at ASX technology ETFs for those interested in investing in the digital future.
How to invest in ASX technology ETFs?
ETFs, by their nature, are diverse or somewhat diverse options for investors. As mentioned, they’re a basket of securities, which means they can hold multiple stocks in a sector or may even cover more than one industry.
Fast-growing and already robust, Australia's tech sector is worth 8.5 percent of the country’s total GDP, or AU$167 billion. Furthermore, as of 2022, Australia ranked 16th in the world for digital competitiveness. Given the scale of the tech market in Australia and globally, ETFs can be a good choice for investors.
Beyond diversity, one of the main advantages of an ETF is the ability to buy and sell at any time during the trading day. That's in contrast to mutual funds, which trade at the end of the day.
One thing to watch for with ETFs is portfolio duplication. If your portfolio is diverse, make sure you aren't going to create a redundancy with an ETF — you can do this by checking your total exposure in a given sector, not just the exposure given by the ETF.
What are the biggest ASX technology ETFs?
Below, we’ll list some of the biggest ETFs in the Australian tech sector. The funds are listed in order of market capitalisation, with data gathered using TradingView’s stock screener on February 29, 2024.
1. Betashares NASDAQ 100 ETF
Market cap: AU$4.3 billion; year-to-date gain: 11.45 percent; current share price: AU$41.59
The Betashares NASDAQ 100 ETF (ASX:NDQ) devotes 50.4 percent of its holdings to technology, with the next-highest category, communication services, ranking at 15.5 percent.
2. Betashares Global Cybersecurity ETF
Market cap: AU$936.17 million; year-to-date gain: 11.19 percent; current share price: AU$12.12
The Betashares Global Cybersecurity ETF (ASX:HACK) specialises in cybersecurity, a market that protects and enhances other tech companies' offerings. The ETF's holdings are almost fully in the tech sector, with about 89 percent falling under that umbrella; about half of those are focused on systems software. As technologies advance, so do threats, making these services necessary for businesses and individuals.
3. Betashares Asia Technology Tigers
Market cap: AU$465.59 million; year-to-date gain: 6.05 percent; current share price: AU$8.06
The Betashares Asia Technology Tigers (ASX:ASIA) has is wholly focused on technology companies in Asia ex Japan, with 25 percent being in semiconductor companies. As for countries, China and Taiwan both make up about 35 percent of the ETF's holdings, with South Korea and India making up the majority of the remainder. Of course, this makes it not as globally representative as the other ETFs on this list.
4. Morningstar Global Technology ETF
Market cap: AU$362.21 million; year-to-date gain: 9.8 percent; current share price: AU$107.81
As its name implies, all of the holdings of the Morningstar Global Technology ETF (ASX:TECH) are in the tech sector. Although it does have holdings in several countries, the lion's share come from the US at around 67.2 percent.
5. Global X ROBO Global Robotics & Automation ETF
Market cap: AU$245.92 million; year-to-date gain: 4.26 percent; current share price: AU$76.58
The Global X ROBO Global Robotics & Automation ETF (ASX:ROBO) invests in robotics and automation stocks from around the world. Its portfolio includes companies that create these technologies and those that utilise them, such as companies involved in artificial intelligence, autonomous vehicles, industrial robots and more.
This is an updated version of an article first published by the Investing News Network in 2022.
Don’t forget to follow us @INN_Australia for real-time news updates!
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
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Melissa Pistilli has been reporting on the markets and educating investors since 2006. She has covered a wide variety of industries in the investment space including mining, cannabis, tech and pharmaceuticals. She helps to educate investors about opportunities in a variety of growth markets. Melissa holds a bachelor's degree in English education as well as a master's degree in the teaching of writing, both from Humboldt State University, California.
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Melissa Pistilli has been reporting on the markets and educating investors since 2006. She has covered a wide variety of industries in the investment space including mining, cannabis, tech and pharmaceuticals. She helps to educate investors about opportunities in a variety of growth markets. Melissa holds a bachelor's degree in English education as well as a master's degree in the teaching of writing, both from Humboldt State University, California.
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