Investing in U.S Tech/FANG stocks?

RolandFlagg

I'm not expert, but I believe the way the virus will shape our future is that more and more the big online firms will get stronger, and I want more exposure to these stocks.
Fang stocks: Facebook, Amazon, Netflix, Alphabet (Google).
As well as others who's business is solely online or in tech, such as Apple, Nvedia and PayPal.
I want to hold these type of stocks for the very long term.
Obviously I could go to somewhere like AJ Bell and buy these stocks individually, but I wondered if there is ETF I can SIPP that covers these stocks?

Linton

There are many ways in which to access  the FANGs and other tech companies from AJBell of similar, for example:

1) You can buy a tech fund - see  https://www.trustnet.com/fund/price-performance/o/ia-unit-trusts?sector=O%3ATECHNOL

2) You can buy a tech ETF - see https://www.trustnet.com/fund/price-performance/e/exchange-traded-funds?tab=fundOverview&sector=E%3AIIT

Points to note:

1) Investing in tech is risky as the sector is  prone to wild over-valuations.  20 years ago in the .com crash the Tech sector dropped by 80% and did not recover its former value until 2016.  Only put a small % of your investments into one of the funds or ETFs.

2) Many of the ETFs are highly focussed in a particular niche. In my view new investors should be wary of ETFs in general, the highly focussed ones are extremely risky and are not appropriate for any more than a tiny minority of private investors..

3) The companies you list have quickly risen from virtually nothing to some of the most valuable business in the world.  They could disappear as quickly as many major tech companies in the past have done.  Invest broadly, dont focus on a handfull of companies that are doing well now.  They may have a bright future, but much of that future may already be included in the price.

4) If you were to just buy one simple general global fund it is likely that around 25% of your money would be invested in tech and communications companies.  I would not want any greater % of my total investments in those sectors.

george4064

Further to what Linton said, another option is that you could simply buy broad US indices that have FANG stocks as their constituents. I have listed a few examples below;

1. iShares Core S&P 500 ETF - Simply tracks the performance of the S&P 500 index, many of the top constituents are tech stocks.


2. iShares Nasdaq 100 UCITS ETF - Also tracks the performance of an index, but the Nasdaq 100 index. This is a very tech heavy index which you can see from its top 10 holdings, whilst similar to the S&P 500 it is much more concentrated in fewer stocks and 100% tech. Higher risk than S&P 500.

AnotherJoe

Or buy a specialist tech trust - one that springs to mind, just because i have it, is SMT.

RolandFlagg

Thanks for the replies. I've found two Vanguard ETFs that would suit my needs, but it seems they are only available to the .com site and not the .co.uk site.
https://investor.vanguard.com/etf/profile/VUG
https://investor.vanguard.com/etf/profile/MGV

george4064

RolandFlagg said:

Thanks for the replies. I've found two Vanguard ETFs that would suit my needs, but it seems they are only available to the .com site and not the .co.uk site.
https://investor.vanguard.com/etf/profile/VUG
https://investor.vanguard.com/etf/profile/MGV

Check here for all products available via Vanguard UK: https://www.vanguardinvestor.co.uk/what-we-offer/all-products

MaxiRobriguez

RolandFlagg said:

Thanks for the replies. 

Recommend you actually read them now...

Filo25

AnotherJoe said:

Or buy a specialist tech trust - one that springs to mind, just because i have it, is SMT.

I'm quite grateful that I picked up some SMT in March, it has had a hell of a run since then, still obviously you have to be willing to accept the potential of very significant volatility with holdings like that

MDMD

Filo25 said:

AnotherJoe said:

Or buy a specialist tech trust - one that springs to mind, just because i have it, is SMT.

I'm quite grateful that I picked up some SMT in March, it has had a hell of a run since then, still obviously you have to be willing to accept the potential of very significant volatility with holdings like that

I’m in a similar position, I think when most of my holdings were I’m negative territory SMT was breaking even and now is by far my best performer. 

doe808

MDMD said:

Filo25 said:

AnotherJoe said:

Or buy a specialist tech trust - one that springs to mind, just because i have it, is SMT.

I'm quite grateful that I picked up some SMT in March, it has had a hell of a run since then, still obviously you have to be willing to accept the potential of very significant volatility with holdings like that

I’m in a similar position, I think when most of my holdings were I’m negative territory SMT was breaking even and now is by far my best performer. 

Yeah, SMT has been far and away my best holding. I'd presumed (wrongly) that it would fair worse that the market in any downturn.

Alexland

doe808 said:

I'd presumed (wrongly) that it would fair worse that the market in any downturn.

Depends on the downturn. This one worked well for tech stocks. Who knows for the next one?