The Invesco QQQ Trust, an exchange-traded fund (ETF), tracks the Nasdaq-100 index, which includes 100 of the largest nonfinancial companies listed on the Nasdaq stock exchange. The ETF has delivered impressive returns over the past few years, primarily due to its holdings in tech giants leading the artificial intelligence (AI) industry. However, the QQQ is currently experiencing a correction, having fallen by as much as 13% from its recent all-time high.
Despite this setback, historical trends suggest that new record highs often follow such corrections, potentially making this a buying opportunity for investors. The Nasdaq-100 has consistently reached new highs after every correction since its inception in 1985. Given the long-term growth potential of the companies in the index, investors may want to consider buying now.
The QQQ’s portfolio includes various AI powerhouses, such as Apple, Microsoft, Amazon, Cisco Systems, Intuitive Surgical, Advanced Micro Devices (AMD), and Palo Alto Networks.
Nasdaq correction buying opportunity
These companies are at the forefront of various segments within the tech industry and are poised to benefit from advancements in AI.
According to investment manager Capital Group, 10% or more stock market corrections occur approximately every two and a half years. Various factors, including economic shocks and periods of general uncertainty, can trigger these corrections. Despite these fluctuations, the Nasdaq-100 has a resilient track record.
The ETF contains some of the highest quality tech companies globally, many well-positioned to continue benefiting from AI advancements. In conclusion, buying the Invesco QQQ ETF during the current Nasdaq correction could be wise for long-term investors. The ETF’s robust portfolio of leading tech companies and its historical performance suggest strong potential for recovery and growth.
Suppose you’re considering adding to your investment portfolio. In that case, the Invesco QQQ ETF offers exposure to a broad range of influential and innovative companies, making it a compelling option amidst the ongoing market correction.
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