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Best way invest USA Technology

Index tracking funds and ETFs
Cookie
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Best way invest USA Technology

#153291

Postby Cookie » July 19th, 2018, 8:00 am

I was looking at investing a small amount in USA Technology and was wondering the best way to do this

I could invest in shares of the FAANGS, but also looked at ETFs. I am not sure of the best Indexes for US Tech, but have looked at these

Invesco EQQQ NASDAQ-100 UCITS ETF
iShares S&P 500 Information Technology Sector UCITS ETF USD (Acc)

I guess there will be a normal debates of why invest in US Tech, but if anyone else has done this, I would appreciate how they have done this

I realise that S&P 500 and World trackers have a % exposure to US Tech companies

Lootman
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Re: Best way invest USA Technology

#153302

Postby Lootman » July 19th, 2018, 8:37 am

If you invest in a NASDAQ tech ETF then that will exclude those large tech companies that have been "promoted" and now list on the NYSE.

There is a NASDAQ ETF, for instance, ticker QQQ, but it also has a fair wodge in biotech, which you may or may not want.

A cleaner play would be something like ticker XLK, the S&P technology ETF, which is independent of exchange.

Also note that in any tech fund there will be huge weightings in the top names. If you wish to avoid that look for an equal-weighted tech ETF:

https://www.etftrends.com/2012/10/equal ... out-apple/

77ss
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Re: Best way invest USA Technology

#153339

Postby 77ss » July 19th, 2018, 10:38 am

Cookie wrote:I was looking at investing a small amount in USA Technology and was wondering the best way to do this

I could invest in shares of the FAANGS, but also looked at ETFs. I am not sure of the best Indexes for US Tech, but have looked at these

Invesco EQQQ NASDAQ-100 UCITS ETF
iShares S&P 500 Information Technology Sector UCITS ETF USD (Acc)

I guess there will be a normal debates of why invest in US Tech, but if anyone else has done this, I would appreciate how they have done this

I realise that S&P 500 and World trackers have a % exposure to US Tech companies



You could do worse than look at some of the specialist ITs. Examples are Allianz Tech Trust (ATT) and Polar Capital (PCT).

They are not exclusively US - but having 15% or so in the rest of the world seems like no bad thing to me.

Disclosure - I hold ATT.

OLTB
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Re: Best way invest USA Technology

#153343

Postby OLTB » July 19th, 2018, 10:59 am

77ss wrote:
Cookie wrote:I was looking at investing a small amount in USA Technology and was wondering the best way to do this

I could invest in shares of the FAANGS, but also looked at ETFs. I am not sure of the best Indexes for US Tech, but have looked at these

Invesco EQQQ NASDAQ-100 UCITS ETF
iShares S&P 500 Information Technology Sector UCITS ETF USD (Acc)

I guess there will be a normal debates of why invest in US Tech, but if anyone else has done this, I would appreciate how they have done this

I realise that S&P 500 and World trackers have a % exposure to US Tech companies



You could do worse than look at some of the specialist ITs. Examples are Allianz Tech Trust (ATT) and Polar Capital (PCT).

They are not exclusively US - but having 15% or so in the rest of the world seems like no bad thing to me.

Disclosure - I hold ATT.


I also hold ATT and in the short term I've held it, it's done the business for me. It's one of the recommended investment trusts in John Baron's growth portfolio.

Cheers, OLTB.

hiriskpaul
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Re: Best way invest USA Technology

#153418

Postby hiriskpaul » July 19th, 2018, 2:44 pm

You might want to have a look at Vanguard's Information Technology ETF (VGT). Very low charges (0.1%) and a good selection of US IT companies. Buying any US listed ETF might prove tricky now with many UK brokers, though IG still offer them.

Cookie
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Re: Best way invest USA Technology

#153428

Postby Cookie » July 19th, 2018, 3:21 pm

hiriskpaul wrote:You might want to have a look at Vanguard's Information Technology ETF (VGT). Very low charges (0.1%) and a good selection of US IT companies. Buying any US listed ETF might prove tricky now with many UK brokers, though IG still offer them.


You can buy US ETFs on IG (https://www.ig.com/uk/)?

hiriskpaul
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Re: Best way invest USA Technology

#153435

Postby hiriskpaul » July 19th, 2018, 3:54 pm

Cookie wrote:
hiriskpaul wrote:You might want to have a look at Vanguard's Information Technology ETF (VGT). Very low charges (0.1%) and a good selection of US IT companies. Buying any US listed ETF might prove tricky now with many UK brokers, though IG still offer them.


You can buy US ETFs on IG (https://www.ig.com/uk/)?

Yes. I originally thought that may be because I am classified as a Professional Investor by IG, but a colleague has informed me that he has access to US listed ETFs via IG as well.

p.s. Usual warning about investing in any offshore collective - you will be taxed as income on capital gains unless the collective is a reporting fund, so check first! HMRC reporting funds are in a spreadsheet here: https://www.gov.uk/government/publicati ... ting-funds

VGT, along with most if not all Vanguard US listed ETFs, is on the list but a lot of US listed ETFs are not, most notably iShares US listed ETFs.

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Re: Best way invest USA Technology

#153482

Postby Cookie » July 19th, 2018, 6:46 pm

hiriskpaul wrote:
Cookie wrote:
hiriskpaul wrote:You might want to have a look at Vanguard's Information Technology ETF (VGT). Very low charges (0.1%) and a good selection of US IT companies. Buying any US listed ETF might prove tricky now with many UK brokers, though IG still offer them.


You can buy US ETFs on IG (https://www.ig.com/uk/)?

Yes. I originally thought that may be because I am classified as a Professional Investor by IG, but a colleague has informed me that he has access to US listed ETFs via IG as well.

p.s. Usual warning about investing in any offshore collective - you will be taxed as income on capital gains unless the collective is a reporting fund, so check first! HMRC reporting funds are in a spreadsheet here: https://www.gov.uk/government/publicati ... ting-funds

VGT, along with most if not all Vanguard US listed ETFs, is on the list but a lot of US listed ETFs are not, most notably iShares US listed ETFs.


Great thanks, I thought US listed ETFs were not available now in the UK because they didnt want to bother in producing the KIDs (hope that is correct, the factsheet things)

I presume they are sold in US dollars and there is a currency charge?
IGs charging structure is rather complex at first glance

hiriskpaul
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Re: Best way invest USA Technology

#153505

Postby hiriskpaul » July 19th, 2018, 8:03 pm

Cookie wrote:
hiriskpaul wrote:
Cookie wrote:
You can buy US ETFs on IG (https://www.ig.com/uk/)?

Yes. I originally thought that may be because I am classified as a Professional Investor by IG, but a colleague has informed me that he has access to US listed ETFs via IG as well.

p.s. Usual warning about investing in any offshore collective - you will be taxed as income on capital gains unless the collective is a reporting fund, so check first! HMRC reporting funds are in a spreadsheet here: https://www.gov.uk/government/publicati ... ting-funds

VGT, along with most if not all Vanguard US listed ETFs, is on the list but a lot of US listed ETFs are not, most notably iShares US listed ETFs.


Great thanks, I thought US listed ETFs were not available now in the UK because they didnt want to bother in producing the KIDs (hope that is correct, the factsheet things)

I presume they are sold in US dollars and there is a currency charge?
IGs charging structure is rather complex at first glance

Yes there is a currency charge of 0.3%, but you don't get to see it broken out anywhere, although they do provide the exchange rate they have used.

on-line charges for US shares are 2c per share, subject to a minimum of $15 (i.e. quite a high minimum!). In addition they recently introduced a £24 per quarter custody fee. You can avoid that by trading 3 times in the quarter, but if you trade less than 3 times any trade commission is deducted from the custody fee. Full charges are here: https://www.ig.com/uk/investments/share ... costs-fees

It is odd that IG are still allowing retail investors to buy US listed ETFs and the window of opportunity may not be open for long. If it is closed though IG will probably not insist that US ETF positions are closed. HL are perfectly happy to allow me to hold US listed ETFs, but will not allow me to buy any more.

p.s. Don't forget the reporting fund issue before you buy! I keep mentioning it because I once got caught out with a Canadian listed ETF that did not have reporting status - I forgot to check first :(

Edit - one handy feature is that IG do not automatically convert dollars from dividends, etc. to pounds if you set your account up that way. This means your dollars can be reinvested into other dollar denominated securities without going through 2 FX conversions.


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