Our Q&As are emailed in our Saturday Morning Report, find the answer to this question below.
Hi MM Team, Thx for your continued good work, explanations & advice around the Mkts. 2026 yrs has seen the Mag7 retreat about 10%, which is far more than S&P500. What are your thoughts on the ETF FANG which covers all but Tesla plus a few extras? Microsoft has been a big loser in 26 so is it better just to go there? Thx again Glenn
Hi Glenn,
For those that are unfamiliar with the FANG ETF, it holds the 10 largest tech companies ex-Tesla, roughly equally weighted across the big Tech players i.e Mag7 and is quarterly rebalanced with the 10th slot has historically rotating— past members have included AMD, Snowflake, and others. Current holdings are Nvidia, Alphabet/Google, Meta, Apple, Broadcom, Amazon, Netflix, Microsoft, Crowdstrike and Palantir.
We will note that while performance of the underlying holdings as a cohort have been historically strong, it is a highly concentrated ETF, so a few underperformers can weigh heavily. However, this bunch of stocks are trading at fair relative valuations, and consensus 2026 EPS growth estimates for growth and tech stocks have been revised significantly higher – we’re bullish US tech, targeting new highs in 2026.
Assuming MM is on point, a basket of 10 large cap US tech stocks is likely to at least follow the broader tech index higher, especially with the more volatile Tesla not included. As to simply opting for Microsoft (MSFT US) which has corrected ~35% in 2026, we do believe it represents great value at current levels.
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