This Robot-Run ETF Of Tesla Fame Sold Snapchat, AMD In August And Loaded Up On These Big Tech Stocks Instead
The Qraft AI-Enhanced US Large Cap Momentum ETF (NYSE:AMOM), an exchange-traded fund driven by artificial intelligence, bought into Amazon.com Inc. (NASDAQ:AMZN), Facebook Inc. (NASDAQ:FB), Nvidia Corp. (NASDAQ:NVDA) and Adobe Inc. (NASDAQ:ADBE) in August.
What Happened: The ETF’s latest portfolio, after rebalancing in August, showed that the fund has sold major chunks of its holdings, or entirely divested in, chipmaker Advanced Micro Devices Inc. (NASDAQ:AMD), Snapchat parent Snap Inc. (NYSE:SNAP) and communications technology company Zoom Video Communications Inc. (NASDAQ:ZM).
The ETF became popular over accurately predicting the price movements of Tesla Inc. (NASDAQ:TSLA) shares in multiple instances.
The fund now has Amazon.com as its largest investment with an 8.0% weighting, followed by Facebook with a weighting of 7.9% and Nvidia with 6.1% weighting.
The other two stocks that make up the top five holdings in the AMOM portfolio are retail giant Walmart Inc. (NYSE:WMT) with a 4.8% weighting and home improvement retailer Home Depot Inc. (NYSE:HD) with 4.2%.
Prior to the rebalancing, the ETF had Advanced Micro Devices, Snap, Zoom Video, Align Technology and pet healthcare company IDEXX Laboratories Inc. (NASDAQ:IDXX) as its five largest stock holdings.
Why It Matters: AMOM, a product of South Korea-based fintech group Qraft, tracks 50 large-cap U.S. stocks and reweighs its holdings each month. The fund uses AI technology to automatically search for patterns that have the potential to produce excess returns and construct actively managed portfolios.
AMOM has delivered year-to-date returns of 15.1%, compared to its benchmark – the Invesco S&P 500 Momentum ETF (NYSE:SPMO) – which has returned 20.5% so far this year.
The fund’s latest rebalancing shows it has turned bullish on tech and retail stocks amid the economic reopening, while reducing its stake in companies such as Snap and Zoom Video that have benefited from the COVID-19 pandemic.
It was reported last week that Amazon has started to transport cargo for outside customers as part of its efforts to grow its shipping business. The company also reportedly plans to launch Amazon-branded TVs as soon as October in the United States.
Facebook, which launched the Horizon Workrooms app last month, has intensified its focus on the augmented reality (AR) and virtual reality (VR) segments in recent years.
Price Action: AMOM shares closed almost 0.4% lower in Wednesday's trading at $36.88.
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