The Best Tech ETF to Invest $2,000 in Right Now

<p>Are you a firm believer in the technology sector's long-term potential, but also fear that most technology funds are just too dangerously top-heavy right now to buy any of them? If that sounds like you, you're not crazy; most tech ETFs are wildly unbalanced at this time. Fortunately, there's an easy solution that could prove to be a strategically brilliant addition to your portfolio right now.</p>
<p>But first things first.</p>
<p>Will AI create the world's first trillionaire? Our team just released a report on the one little-known company, called an "Indispensable Monopoly" providing the critical technology Nvidia and Intel both need. <a href="https://api.fool.com/infotron/infotrack/click?apikey=35527423-a535-4519-a07f-20014582e03e&amp;impression=02f39f8a-f2f0-4da5-9e2f-647060c2aa76&amp;url=https%3A%2F%2Fwww.fool.com%2Fmms%2Fmark%2Fa-sa-ai-boom-nvidias%3Faid%3D10891%26source%3Disaediica0000069%26ftm_cam%3Dsa-ai-boom%26ftm_veh%3Dtop_incontent_pitch_feed_yahoo%26ftm_pit%3D18914&amp;utm_source=yahoo-host-full&amp;utm_medium=feed&amp;utm_campaign=article&amp;referring_guid=28aa5b2d-e12f-4ffa-ba48-88a3e06430e7">Continue »</a></p>
<h2>ETFs suffer from a common problem</h2>
<p>You almost certainly understand the underlying reason for most technology exchange-traded funds' biggest problem right now. That's the advent of <a href="https://www.fool.com/investing/stock-market/market-sectors/information-technology/ai-stocks/?utm_source=yahoo-host-full&amp;utm_medium=feed&amp;utm_campaign=article&amp;referring_guid=28aa5b2d-e12f-4ffa-ba48-88a3e06430e7">artificial intelligence</a> (AI). It has disproportionately benefited the stocks of a relatively small number of companies deep into the AI business. For perspective, Nvidia, Apple, and Microsoft collectively make up 43% of the cap-weighted Vanguard Information Technology ETF's (NYSEMKT: VGT) current value. If the AI bubble pops, this fund could suffer a setback far bigger than most investors might think is possible for any ETF consisting of 320 different tickers.</p>
<p>It's not just VGT, though. Nearly 40% of the State Street Technology Select Sector SPDR ETF's (NYSEMKT: XLK) value consists of the exact same three stocks. Adding Broadcom and Micron Technology to the mix pushes this figure up to almost 50% of the fund's total value. Even the Invesco QQQ Trust (NASDAQ: QQQ), meant to mirror the performance of the Nasdaq-100 index -- which has guardrails in place specifically meant to prevent such an imbalance -- has become uncomfortably unbalanced. Its 10 biggest holdings account for a little more than 47% of the ETF's total value. This is the sort of concentration most fans of <a href="https://www.fool.com/investing/how-to-invest/etfs/?utm_source=yahoo-host-full&amp;utm_medium=feed&amp;utm_campaign=article&amp;referring_guid=28aa5b2d-e12f-4ffa-ba48-88a3e06430e7">exchange-traded funds</a> are hoping to avoid.</p>
<p>Yet, tech stocks still remain the market's most promising prospects for long-term growth.</p>
<h2>Better balanced by design</h2>
<p>So what's the solution (now, as well as in the long run)?</p>
<p>It's not an especially popular ETF compared to choices like the aforementioned QQQ, VGT, or XLK. But the Invesco S&amp;P 500 Equal Weight Technology ETF (NYSEMKT: RSPT) is built from the ground up to sidestep this very problem.</p>
<p>Just as the name suggests, while it holds the same basic 72 S&amp;P 500 tech stocks that most conventional cap-weighted technology ETFs do, it holds them all in equal-sized proportions. It rebalances these positions every quarter just to make sure this remains the case, selling or buying these tickers as needed.</p>