From Yahoo Finance: 2025-04-15 05:34:00

The S&P 500 is dominated by the Information Technology sector, making up nearly 30% of the index. Recent market declines have hit this sector hard, with some companies like Apple, Microsoft, and Nvidia experiencing significant drops. Investors are eyeing opportunities in the Vanguard Information Technology ETF, which has outperformed the S&P 500 consistently since 2004.

President Trump’s tariffs have caused economic concerns, impacting consumer costs and retaliatory measures from other countries. However, many tech companies, like Microsoft and Nvidia, are shielded from direct tariff effects. Recent exclusions for smartphones and computers benefit Apple, a major player in the tech industry. The Vanguard Information Technology ETF holds stocks primarily involved in software, cloud services, and exempted products, offering a diversified investment option.

Despite the potential indirect impact of tariffs on tech companies, the Vanguard Information Technology ETF presents a buying opportunity during the current tech bear market. High-performing tech stocks like Apple, Microsoft, and Nvidia are expected to weather economic slowdowns well due to strong balance sheets and market positions. The AI revolution is also expected to boost the global economy, with tech companies leading the charge.

The Vanguard ETF has historically outperformed the S&P 500 since its inception in 2004, delivering substantial compound annual returns. Quality tech stocks have the potential to provide solid returns despite economic challenges, making them attractive long-term investments. Investors should consider the growth prospects of tech companies in the face of global trade tensions and the increasing value of the AI market.

The Motley Fool Stock Advisor team has identified promising stocks for investors, though the Vanguard Information Technology ETF didn’t make the cut. Past recommendations like Netflix and Nvidia have delivered significant returns, showcasing the team’s market-beating performance. Investors are encouraged to explore the top stock picks to potentially achieve substantial gains.

Read more: 1 Spectacular Vanguard ETF to Buy With $550 During the Tech Bear Market