January 2021: Week 2

Edition #028 - Data recap of last week's big moves inside the Tech ETF landscape. See what to keep an eye on for the week ahead.

After a blockbuster first week to the year, the second week of January saw a week resembling something more normal.

The top 5 Tech ETFs (non-levered, non-inverse, >$100 AUM) gained an average of just 2.19%

With strength from $ARKK

Currently the strongest ETF so far this year is $ARKK, after it and $BLOK remain the only two ETFs to spend both weeks in the top 5.

Even more impressive is that in this group of 60 ETFs, $ARKK finished in 2nd place through 2020 with a return of 147%.

Back to back triple digit returns will be very impressive. Being up 14% YTD already has it at a good shot.

How much strength is left?

Out of $ARKKs 52 holdings, only 2 stocks are currently sitting at their all time highs:

$TWLO: Twilio (Twilio is an American cloud communications platform as a service company based in San Francisco, California. Twilio allows software developers to programmatically make and receive phone calls, send and receive text messages, and perform other communication functions using its web service APIs.)

$TXG: 10x Genetics (10x Genomics is an American biotechnology Company that designs and manufactures gene sequencing technology used in scientific research.)

Which have continued their great runs since this time last year which saw $TWLO return 226%, $TXG 112%, while $ARKK split the difference at 170%

Part of $TWLO’s early 14% run this year has been helped by investment bank Stifel initiating coverage last week with a buy rating

“Stifel analyst J. Parker Lane initiated coverage of Twilio with a Buy rating and $425 price target. He believes Twilio's "clear leadership and category defining position in its core market" allows it to command a premium multiple in the software space. He sees Twilio having the opportunity to grow organically in the mid-term by greater than 30%, the analyst added.”

$TWLO is expected to report earnings around February 3rd.

The biotech rally

Despite these two stocks hitting all time highs. The real strength of $ARKK this year has come from the bio/genetics side of things with 7 lifestyle science companies in the ETF returning 25% YTD already (and not to mention 3D printing co Stratasys $SSYS leading the charge up nearly 54%).

Disclosure: This author currently holds shares and is long $TWLO.

Thanks again for reading and catch you next week,