Too open to Big Tech? These ETFs can amplify your risk

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Investing opportunities beyond the Magnificent 7

Big Tech’s market dominance could push more investors into mutual funds, according to VettaFi’s Todd Rosenbluth.

“Investors are becoming concerned that too much money is concentrated in a handful of stocks within the broader ETFs available. [are] tied to the S&P 500 or even the Nasdaq 100,” the firm’s head of research told CNBC’s “ETF Edge” earlier this week.

Rosenbluth names the Invesco S&P 500 Equal Weight ETF and the Invesco S&P 500 Equal Weight Technology ETF as options for investors who want to be less exposed to the “Magnificent Seven.”

“You own the same companies you would find within the S&P 500 or in the technology sector. But instead of being controlled by Apple and Microsoft and Nvidia, you spread that risk around the other companies,” Rosenbluth said.

Ahead of this week’s earnings from five of the Magnificent Seven names, BNY Mellon’s Ben Slavin noted that there have been inflows into the group so far this year. At the same time, he found “less popular” market groups including finance and parts of real estate arouses interest.

“In our discussions with advisers, [they’re] looking for another place to go and starting to get worried based on it [Big Tech] valuations,” said the firm’s global head of ETFs.

CNBC’s Magnificent 7 Index, which consists of apple, alphabet, Meta, Microsoft, Amazon, Nvidia and Tesla, rose nearly 6% on Friday. The index is up 68% over the past 52 weeks.


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