November was a tricky month for large- and megacap growth stocks. That was highlighted by the Nasdaq-100 (NDX) and S&P 500 Growth indexes finishing in the red in the 11th month of the year.
These days, it's not unreasonable for investors to feel as if there's one word attached to AI: “bubble.” AI bubble talk is increasing in frequency, as are comparisons to the internet bubble of 2000.
Market participants have rapidly become concerned about the state of affairs with growth stocks. That includes some of the previously sturdy megacap names.
Active ETFs have proliferated in recent years, bringing dynamic new strategies to the broader ETF ecosystem. Despite that, most sector ETFs, in particular, take a passive investing approach to their segments, by closely tracking an index.
Experienced market participants know the early innings of the AI investing thesis have largely been marked by hardware; namely, semiconductors. It's a key reason Nvidia (NVDA) is the first artificial intelligence stock that comes to many investors' minds.
Hedge funds are always buying and selling stocks and exchange-traded funds (ETFs), and while it might not always be a great idea to replicate their moves, it doesn't hurt to keep a watch on what they're eyeing.
The Invesco QQQ (QQQ) was launched on March 10, 1999, and is a passively managed exchange traded fund designed to offer broad exposure to the Large Cap Growth segment of the US equity market.
There's no denying that some big-name growth stocks, including some with clear AI ties, have recently pulled back. But that doesn't mean the AI investment thesis is on its last legs.
There's no denying AI has again been a captivating theme for investors and technology enthusiasts this year. But that proposition could be ramped up in 2026.
The Invesco QQQ Trust (NASDAQ:QQQ ) , SPDR S&P 500 ETF (NYSEARCA:SPY ) and the SPDR Dow Jones Industrial Average ETF Trust (NYSEARCA:DIA ) are among the market's biggest ETFs, each tracking a different theme.
The iShares Expanded Tech-Software Sector ETF offers focused software exposure, but the Invesco QQQ Trust ETF remains the superior tech play. QQQ's broader diversification, mega-cap inclusion, and balanced tech exposure deliver better risk-adjusted returns and defensiveness across market cycles than IGV. IGV's higher concentration and valuation make it riskier, while QQQ captures AI growth and mega cap defensiveness without sacrificing upside.
The Invesco QQQ Trust (NASDAQ:QQQ ) has become the default setting for anyone who wants a piece of the Nasdaq's biggest names.