October 2020: Week 3
Edition #015 - 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 three positive weeks in a row, the market saw some slight retracement over last week. However, moving into this week, Dow Futures are up 181 pts so will see if the market is able to move back into positive territory.
Anyway, let’s jump right into it…
Weekly Changes:
Out of 114 Tech ETFs analyzed, the average Tech ETFs fell 1% through the week. Keep in mind last weeks positive 4.51% increase (including $SOXL with a 21.15% gain).
Given the negative week it’s not surprising to see that the top 2 Tech ETFs were inverse ETFs with $SOXS (Direxion Daily Semiconductor Bear 3x Shares) leading the way with a 3.2% gain.
Overall, just 12/114 had a positive week (3 of which being inverse ETFs).
Looking at the top 5 standard ETFs, two stocks managed to have 20% gains through the week. $38b $NIO (Nio) a China based EV company leading the way. The stock is up nearly 655% YTD.
Additionally, $NET (Cloudflare) saw a positive change after its announcement of upgraded cloud security services and partnerships, named “Cloudflare One”. YTD 2nd ranked ETF $ARKW took a $25m position in the company around the time of the announcement.
While not appearing in these charts, I did want to point out something I noted in last weeks issue around $FSLY (Fastly).
Well, I hope you watched the stock over the week after starting Monday off at $128 the stock fell to $84.97
While not directly around the questionable press release, management did update quarterly guidance coming into earnings on November 5th. Revising revenue down to “$70.0 to $71.0 million, compared to its previous guidance of $73.5 to $75.5 million.”
Some may say this may be the canary in the coal mine for a rough quarter of earnings, but companies some SaaS companies like $TWLO have recently slightly raised guidance.
One thing to keep in mind with Fastly is that the stock is still up 320% YTD.
Year-To-Date:
Of the 107 ETFs which have been around YTD, the average return sits at a steady 27.84% . The S&P 500 ended the week with 8.13% YTD returns.
The top 5 constituents saw no changes after a volatile past few weeks.
The top 5 stocks from these ETFs were once again relatively similar, however $FSLY did drop out of the top 5.
I’m continued to be impressed at $ZM (Zoom). During their annual user conference Zoomtopia, on the 14th, the company shared a couple of major improvements to the platform.
While end-to-end encryption (E2EE) was a large discussion and focus point for the company, investors and users earlier in the year and did receive some development notes here, what stood out to me was their launch of their 3rd party developer integrations.
“Zapps: Zapps enable developers to create apps that power workflows before, during, and after the meeting. Zoom has brought first and third-party developed apps into the meeting experience for real-time adoption. Zapps are designed to give developers a fast and flexible web view canvas to create apps, viral distribution, and IT deployment and manageability. Over 25 launch partners joined Zoom - their demo videos are available at zoom.us/zapps. “
Integrations and a healthy developer ecosystem is something that I personally keep a very strong eye on when investing in companies. While I have no position in $ZM this makes it a more compelling investment for me (even at/in spite of their 727% gain through the year).
As always, hope this issue gives you a better footing to start the week off on.
Thanks to everyone’s support to pass through 265 subscribers for this newsletter over the last 15 weeks.
Thanks again,
Stuart
Great write up this week! Nice seeing $NIO in the list.