Monthly Archives: July 2017

These measures of volatility represent how much traders are paying to hedge against downside moves for the respective indexes. As expectations for volatility rise, it gets more expensive to buy insurance against a potential fall. The Nasdaq 100 and S&P 500 volatility measures differ by 7.5 as of July 3.

The strategist shared his key reasons why Nasdaq volatility levels are rising versus S&P 500 and why it may foreshadow a tech sell-off in an email.

He noted that investors are rotating to value stocks and away from growth stocks. "As we start Q3, growth continues to lose leadership," he also said in his report.

During the first half of this year, 41 stocks in the Nasdaq 100 rose 30 percent or more. Further, he said in the email, there was a connection between bond prices and the rise in the Nasdaq 100, and now they are going down together. His conclusion: "Valuations are insane" in the Nasdaq 100.

McDonald warned his clients that technology may under perform in the coming months and recommended investors trade ahead of the potential decline.

"Getting out in front of the rotation is more important than valuation as capital flows out of highly concentrated trades it has to go somewhere in a bull market. It's a growth into value tsunami," he wrote.

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Investors are increasingly worried about a coming drop in technology stocks - CNBC

By Kathleen J. Sullivan

As the Stanford students enrolled in Ending Poverty with Technology considered which problems to tackle in the vast landscape of poverty, they chose issues close to their hearts, from hunger in communities near campus to the distribution of counterfeit seeds to small farmers in Africa.

Helen Park, right, and Timothy Tatenda Mazai chat with Mayuka Sarukkai about their project to help low-income families trade childcare services. (Image credit: L.A. Cicero)

One group of students Timothy Tatenda Mazai, 18, Helen Park, 17, and Mayuka Sarukkai, 19 came together over a common passion for improving the lives of children by improving the accessibility and affordability of childcare.

In the land of opportunity it only makes sense that every human being has access to the same resources and pathways to success an ideal we are far from achieving, said Sarukkai, who is majoring in symbolic systems.

Research literature points to the importance of the first five years in shaping the trajectory of entire lives and we felt really passionate about focusing our efforts around a childs first few years. Childcare also seemed like a real cool opportunity to use technology to augment existing social patterns, rather than replacing them a kind of inversion of some of the more detrimental effects of technology that prioritizes uplifting invaluable human resources rather than transplanting them.

As their capstone project, the team proposed a web platform and mobile app called CareSwap, which was designed to help low-income families trade childcare services within their trusted networks of friends, neighbors and family.

The Ending Poverty course was one of more than 160 Cardinal Courses offered this year. Cardinal Courses, which integrate rigorous coursework with real-world service experience, are a singular feature of a Stanford undergraduate education.

While the course has ended for the academic year, the CareSwap team plans to continue developing the web platform and mobile app.

Our idea evolved so much in the last few months after our interviews and conversations with parents and childcare experts, the students said. We are excited to develop it further next year. This project has become far more than a class assignment for each of us.

Tackling real-world problems

In offering Ending Poverty with Technology David Grusky, a professor of sociology and director of the Stanford Center on Poverty and Inequality, knew he would be presenting undergraduate students with a daunting task.

In this course, students are not just asked to master a rapidly developing basic science on poverty, but also to understand the complicated programs and interventions that have been developed in the United States and elsewhere to reduce poverty, said Grusky, who is also a senior fellow at the Stanford Institute for Economic Policy Research.

But were asking more of them than even that. Were then asking them to figure out, based on what they have learned, how to intervene successfully and actually reduce poverty. To jump into a complicated field, to master it, and then to creatively develop new interventions thats a big ask.

To inspire students, Grusky invited key leaders in the nonprofit and technology industries in Silicon Valley to discuss the ways entrepreneurs are tackling poverty with technology.

Grusky said he and the students, whom he described as brave, bold and persistent in their quest to put technology to use reducing poverty and inequality, shared a single mission during the two-quarter course.

Its not about a professor teaching and the students learning, he said. Were all just part of the same team trying to build products that work to reduce poverty.

Some of the students proposed apps, including one that would allow students to donate the unused meals on their meal plans to low-income families, and another that would encourage wealthy millennials to ramp up their charitable giving.

Other students proposed web platforms, including one that would help low-income individuals find pro bono lawyers. One student proposed combining several technologies smartphones, artificial intelligence and machine learning to identify and drive out counterfeit agricultural seeds in Kenya.

Grusky said some of the proposed projects may be adopted for further development by the

Stanford Poverty & Technology Lab, a fledgling initiative dedicated to developing technology-based solutions to rising inequality in the United States.

The lab is developing an app, under the leadership of Bill Behrman, director of the Stanford Data Lab, for mapping poverty in California. The app could help government agencies and nonprofit organizations better target services by delivering estimates of poverty, unemployment, income and other indicators for very small geographic areas of the state.

During the class, Dorian Pickens, 18, contributed to the development of the mapping app by interviewing possible users about the types of data and visualization that would be most helpful in their work.

Hopefully, the work I contributed can be used to continue developing the project, said Pickens, who is majoring in communication. It should be quite exciting to see what the future holds.

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Stanford students propose new ways to put technology to work addressing poverty and inequality - Stanford University News

The technology sector has always been a haven for high-growth companies, leading the way forward with innovative ideas that, in some cases, change the world. If you want to invest in a variety of tech stocks through a single investment, exchange-traded funds that specialize in technology can be a great way to go. The following five ETFs are among the most popular for technology investors, and they can help you spice up your portfolio with higher-growth prospects.

Technology ETF

Assets Under Management

Expense Ratio

5-Year Average Annual Return

Technology Select Sector SPDR (NYSEMKT:XLK)

$16.2 billion

0.14%

17.3%

Vanguard Information Technology (NYSEMKT:VGT)

$13.1 billion

0.10%

17%

First Trust Dow Jones Internet (NYSEMKT:FDN)

$4.4 billion

0.54%

18.9%

iShares U.S. Technology (NYSEMKT:IYW)

$3.4 billion

0.44%

17%

First Trust Nasdaq-100 Technology Sector (NYSEMKT: QTEC)

$2 billion

0.60%

23.1%

Data sources: Fund providers.

Different technology stocks have differing scope across the sector. Some funds include every bit of the industry, including hardware, software, telecommunications, technology manufacturing equipment, and information technology services. The tech ETFs with the broadest scope include some stocks that you wouldn't necessarily first think of as being tech stocks, but they often share the same growth characteristics as traditional tech names.

Three of the ETFs on the list have a big-picture approach to tech. The Technology Select SPDR is the largest, and it has the vast majority of its money spread across software, internet, hardware, services, and semiconductors. Telecom makes up a small but still significant portion of the ETF's assets, and overall, you'll see nearly 75 stocks that give good coverage of the sector as a whole.

The Vanguard Technology ETF has slightly lower costs, and its approach doesn't entirely mirror that of the SPDR Tech ETF. Internet companies are the industry with the greatest weight in the Vanguard ETF, followed by hardware, systems software, and semiconductors. The holdings are more extensive, with 365 stocks in its portfolio as of its most recent report.

The iShares Technology ETF has a higher expense ratio than the Vanguard and SPDR ETFs, but its holdings look eerily similar. The fund's software and services industry, which includes both traditional and internet-related offerings, make up more than half of the assets of the fund. Hardware is another quarter, with semiconductors representing all but a tiny fraction of remaining assets. One notable difference is that telecom is almost unrepresented in the iShares ETF's portfolio.

Image source: Getty Images.

One issue with all three of the ETFs discussed above is that their holdings are weighted by market capitalization. That leads to the top stocks in the ETFs having huge weightings compared to the remainder of the stocks in the portfolio, so fund performance relies heavily on those key players.

The First Trust Nasdaq 100 Technology ETF uses a different approach. It looks at the tech stocks in the Nasdaq 100 index and then invests on an equal-weight basis, rebalancing quarterly. Therefore, all 34 holdings have weights of about 3%. That works out well when the top stocks in the industry are doing poorly, but it can lead to lagging performance when tech giants do well. You can see from relative returns that those smaller stocks have done a good job over the past five years, and that has bolstered the First Trust ETF's performance.

Another First Trust fund focuses only on internet stocks, defined as getting half of annual revenue from the internet. First Trust Dow Jones Internet has 42 holdings, and although it takes market capitalization into account in weighting those stocks, it also looks at average share volume and accounts for float-adjusted factors. That's especially important with internet stocks, many of which release only a small portion of their outstanding shares in initial public offerings.

Internet related stocks include a vast array of companies, ranging from internet retailers and online brokerage companies to cloud-computing specialists and social media sites. The growth of those subindustries has led to outperformance for the ETF, and investors hope that favorable trend will continue.

These top technology ETFs offer investors several options to get their tech exposure. You should be able to find a fund that will match up well with where you think the future of the technology sector will be.

Dan Caplinger has no position in any stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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The 5 Top Technology ETFs - Motley Fool