The Technology Select Sector SPDR Fund (XLK), managed by State Street Capital Advisors, is undergoing a significant overhaul aimed at boosting exposure to NVIDIA Corp (NVDA) at the expense of Apple Inc (AAPL). If the divestiture goes through as planned, it would reverse the positions of Apple and Nvidia in the ETF, with Nvidia’s weight surpassing 20% and Apple’s dropping to 4.5%. Matt Bartolini, head of SPDR Americas Research at State Street, assured that the rebalance will adhere to the fund’s rules and methodology necessary for compliance with diversification regulations.
The shift in the makeup of the ETF comes after Nvidia’s market value closed above Apple’s on Friday. S&P has indicated that exceptions may be made during the upcoming rebalance. The index committee has stated that it reserves the right to deviate from the general rules in specific circumstances and will notify clients of any changes. This adjustment in sector weightings will be detailed in proforma documents sent to clients leading up to the rebalance at the end of the month.
On Monday, the Technology Select Sector SPDR Fund closed at $231.12, gaining 1.52%, while Nvidia slipped 0.68% to $130.98 and Apple gained 1.97% to close at $216.67. Investors will be closely watching the outcome of this major overhaul in the ETF’s holdings and