“With TEC you have over 250 companies with top names like Apple, Microsoft, Amazon, Alphabet, Facebook/Meta, Visa, Adobe, and more,” explains Needham. “These are all names that people know and use on a daily basis. But supplements [TECI] With the capture of innovators comes: Shopify, Square (Block Inc.), Snowflake… some of these companies that the millennial generation are even more familiar with and are adopting at a more accelerated pace. Furthermore, when looking at the overlap1 Of the two funds, it is only around 9% (as of December 31, 2021), demonstrating the potential diversification benefits of owning both.
Video game companies fit neatly into the latter bracket. Seen as a mainstay of the millennial holiday for years, video games have long earned both the music and film industries combined – and recent high-profile acquisitions, such as Microsoft’s $68.7 billion Activision Blizzard Inc. Now there is a niche investment concern.
However, TECI extends beyond the millennium activities. For example, with online game platform Roblox, Needham highlights the kind of Gen-Z-focused companies that are making waves in the space.
“I have two daughters — and they play Roblox perfectly,” he says. “With a lot of the development of the Metaverse, a lot of it sounds crazy to me: someone is going to buy clothes that they can wear on their virtual avatar? But trust me, my daughters have asked for [Roblox currency] We have regular basis. So an example of a very large market capitalization company is that you want to take some of the risk through an ETF like ours.”
This, Needham pinpoints, is a balancing act – whether investors choose to focus on the current tech landscape giants, the ‘long-game’ future prospects, or a carefully curated mix of both.