The NASDAQ index hit the 5000 level for the first time since 2000 earlier this week. The index has been on a bull run since 2009, but has finally reached the all-time-highs that it saw prior to the dot-com bubble. This ascent has largely been lead by Apple (AAPL), which has become a $750 billion company, making its twice as large as any other U.S. company.
Tech has been soaring, causing some investors to be concerned about history repeating itself. However, the NASDAQ’s valuation is different now, as the majority of companies in the index are strong, profitable businesses.
This week, we have chosen the USAA NASDAQ-100 Index Fund (USNQX) as our fund of the week.
Inside the Fund
The USAA NASDAQ-100 Index Fund was launched in October 2000, in the middle of the NASDAQ’s collapse which stretched from March 2000 to April 2001. Currently, this fund is managed by Brent D. Reeder. The fund currently boasts about $785 million in assets under management (AUM).
The fund is primarily composed of Technology, Healthcare and Consumer stocks.
Historical Performance
| 2011 | 2012 | 2013 | 2014 | YTD |
|---|---|---|---|---|
| 2.9% | 17.46% | 36% | 18.75% | 6% |
Largest Holdings
Over 30% of the fund’s portfolio is in its top five holdings. The YTD performance of these holdings are mostly positive.
| Symbol | Stock | Portfolio Weight | YTD Performance |
|---|---|---|---|
| AAPL | Apple | 12.57% | +17% |
| MSFT | Mircosoft | 7.96% | -7% |
| GOOG | 4.07% | +8.5% | |
| INTC | Intel | 3.59% | -6% |
| GOOGL | 3.47% | +8.5% |
The Bottom Line
For investors seeking exposure to the soaring NASDAQ, an index fund like the USAA NASDAQ-100 Index (USNQX) may be a good choice. Investors seeking an ETF alternative to this fund should consider QQQ. For more information, be sure to read about How Index Mutual Funds Work.
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