The Technology Select Sector SPDR Fund (XLK), a popular tech-focused exchange-traded fund (ETF), is making a major change. The fund will reduce its holdings in Apple and increase its investment in Nvidia. This shift is needed because Apple and Microsoft each hold a 22% weight in the ETF, while Nvidia only has 6%.
It’s important to note that Microsoft ( $Microsoft(MSFT)$ ) will not be impacted by this rebalancing. The changes focus solely on adjusting the weights of Apple ( $Apple(AAPL)$ ) and Nvidia ( $NVIDIA Corp(NVDA)$ ) within the ETF. Microsoft will maintain its current weight of 22%, continuing to be a major component of the XLK ETF.
The rebalancing is scheduled to take place this Friday. Nvidia’s recent success has significantly increased its market value, prompting the ETF to adjust its holdings to better reflect current market dynamics. The sale of Apple shares might temporarily lower its stock price due to increased selling pressure, while the purchase of more Nvidia shares is likely to raise its stock price due to increased demand.
Will it push the price to $140 this week? I feel there is a potential. [Sly]
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