In an effort to re-establish a new bullish bias in the markets, the Nasdaq 100 (QQQ) has introduced new sectors for Communication Services (XLC) and Transports (IYT). The new sectors, which will go into effect on March 18th, are designed to give investors more options in an increasingly volatile market.
The Communication Services Index (XLC) is made up of stocks from major providers of communication services related to the Internet, wireless, media, and entertainment industries. These companies are expected to benefit from the increase in demand for data-driven services. The index includes names like Apple, Microsoft, Facebook, and Netflix.
The Transports Index (IYT) is composed of stocks of companies engaged in transportation activities, such as airlines, trucking, railroad, package, and delivery firms. This sector should benefit from the growing demand for transportation services as the global economy begins to open up following the Covid-19 pandemic. Some stocks included in the index are Delta Air Lines, United Airlines, CSX Corporation, and XPO Logistics.
By adding two new sector indices, investors now have the ability to diversify their portfolios and capitalize on a range of different opportunities, while minimizing risk. It is also important to note that the two indices can be used to measure broader economic activity; the inclusion of the stocks in the Communication Services and Transports indices serves as a barometer for investor sentiment.
Overall, the introduction of the Communication Services (XLC) and Transports (IYT) sectors is a positive sign for the Nasdaq 100 (QQQ). The addition of these two indices provide investors with a greater range of investing options, which can act as a cornerstone for a successful portfolio in a recovering economy. With the revised sector breakdown, investors are sure to have plenty of new and exciting opportunities in the months ahead.
