If you're deciding between Fidelity MSCI Information Technology Index ETF (NYSEARCA:FTEC) and Vanguard Information Technology Index Fund ETF (NYSEARCA:VGT), the choice looks like a coin flip.
The Fidelity MSCI Information Technology Index ETF offers broad, low-cost passive exposure to the U.S. tech sector and is rated a BUY. FTEC stands out for its low 0.08% expense ratio, tight benchmark tracking, and strong historical outperformance versus the S&P 500. The ETF is highly concentrated in mega-cap tech, with the top 3 holdings — Nvidia, Apple, Microsoft — comprising 41.86% of assets, presenting concentration risk.
The Fidelity MSCI Information Technology Index ETF remains a representative, low-cost, diversified tech sector solution, but current valuations warrant caution. FTEC's performance and risk profile are heavily concentrated in a few mega-cap names, notably NVDA (17.32%) and AAPL (14.80%), driving sector returns. Aggregate forward P/E appears reasonable, but excluding top contributors, underlying valuations are stretched and sector growth is less robust.
Launched on October 21, 2013, the Fidelity MSCI Information Technology Index ETF (FTEC) is a passively managed exchange traded fund designed to provide a broad exposure to the Technology - Broad segment of the equity market.
Three tech ETFs. Three very different portfolios.
Fidelity MSCI Information Technology ETF (FTEC) has a 10-year average annual return of 22%+ and should be considered as long-term core technology holding. FTEC benefits from AI tailwinds, a weaker U.S. dollar, and strong capex by hyperscalers, with #1 holding NVDA (18%), Apple, Broadcom, and Micron Technology driving growth. That said, the ETF is top-heavy, with 58% in the top-10 holdings, notably 18% in NVDA and 14.3% in AAPL, aligning with sector leadership.
If you're interested in broad exposure to the Technology - Broad segment of the equity market, look no further than the Fidelity MSCI Information Technology Index ETF (FTEC), a passively managed exchange traded fund launched on October 21, 2013.
Fidelity MSCI Information Technology Index ETF is an indexed ETF with a TER of 0.084% that invests in around 291 information technology stocks. It maintains performance close to more concentrated ETFs like XLK and superior to equal-weight versions such as RSPT. The forward P/E of the info tech segment is 26x: not at the highs of the P/E distribution over the past 10 and 30 years.
The Fidelity MSCI Information Technology Index ETF (FTEC) was launched on October 21, 2013, and is a passively managed exchange traded fund designed to offer broad exposure to the Technology - Broad segment of the equity market.
Both the FTEC and XLK ETFs have strong 1-, 3-, 5-, and 10-year performance track records. Both should be considered as core long-term diversified technology holdings in you portfolio. The top-5 holdings in both ETFs are NVIDIA, Apple, Microsoft, Broadcom, and Palantir. These companies are highly successful, are driving performance, and position the funds well for the future. XLK's focused portfolio (70 holdings vs. FTEC's 292) and larger AUM ($91.8B vs. $16.7B) provide greater scale and a more focused approach.
The Fidelity MSCI Information Technology Index ETF offers diversified, low-cost exposure to U.S. technology stocks, with strong historical outperformance versus peers. FTEC's portfolio is heavily weighted toward semiconductors (31%), with large caps comprising 76% of holdings and a low 0.08% expense ratio. The ETF has delivered robust annualized returns: 21.97% over 10 years, 17.57% over 5 years, and 32.92% over 3 years.
Fidelity MSCI Information Technology Index ETF is rated a Buy for long-term, capital appreciation-focused investors seeking technology sector exposure. FTEC outperforms the S&P 500 and NASDAQ over 5- and 10-year periods, with an ultra-low 0.08% expense ratio and strong momentum ratings. Top holdings include industry leaders like Nvidia, Apple, Microsoft, Palantir, and Broadcom, positioning FTEC to benefit from ongoing AI-driven innovation.