Investing in the Future: Why the iShares Global Tech ETF is a Smart Buy in 2025

Table of Contents

1. Key Highlights:
2. Introduction
3. Technical Momentum: A Bullish Crossover and Strong Support
4. Fundamental Catalysts: AI-Driven Growth and Diversification
5. Contrasting with Semiconductor Sector Weakness
6. Stifel's IGT/BRSL Buy Rating: A Microcosm of Tech's Evolution
7. Risk Management: Low Daily Volatility, High Upside
8. Investment Thesis: Buy IXN for AI's Long Game
9. Final Take
10. FAQ

Key Highlights:

• The iShares Global Tech ETF (IXN) has gained 34.54% since April 2025, driven by a bullish technical momentum and strong support levels.
• IXN offers exposure to over 1,200 global tech firms, including major players like Apple and Microsoft, while providing a diversified strategy against semiconductor sector volatility.
• Analysts project a significant upside for IXN, targeting a price range of $116.72 to $126.93 by September 2025.

Introduction

The technology sector has experienced significant fluctuations in 2025, characterized by the remarkable rise of AI-driven stocks and the stagnation of legacy tech companies, particularly in the semiconductor arena. Amid this shifting landscape, the iShares Global Tech ETF (IXN) has emerged as a beacon of promise. With a remarkable gain of 34.54% since its pivotal moment in April, IXN stands out not only for its performance but also for its potential as a diversified investment in the next wave of technological advancements. This article delves into the dynamics of IXN, exploring its technical strengths, fundamental catalysts, and contrasting its trajectory with the challenges faced by the semiconductor sector.

Technical Momentum: A Bullish Crossover and Strong Support

The technical indicators for IXN paint a robustly bullish picture. Since April, the ETF has formed a “rising trend channel,” characterized by a significant crossover of its short-term moving average (SMA) over the long-term average. This classic bullish crossover signals an upward momentum, buoying investor confidence.

As of mid-June 2025, IXN was classified as a “Strong Buy Candidate” with an impressive score of 7.041, buoyed by a year-to-date gain of 6.30%. Notably, the ETF has maintained an eight-day winning streak, underscoring its resilience and attractiveness to investors.

Key Technicals to Watch:

• Support Levels: Short-term at $91.89, medium-term at $87.16, and long-term at $84.42.
• Volatility: Daily price swings average 1.24%, indicating a manageable risk profile.
• Forecast: Analysts anticipate a 31.56% rise over the next three months, projecting a target price range of $116.72 to $126.93 by September 2025.

Fundamental Catalysts: AI-Driven Growth and Diversification

The IXN tracks the S&P Global 1200 Information Technology Index, providing exposure to a diverse array of over 1,200 global tech firms. While it retains a notable 87% bias towards U.S. companies, IXN also boasts a meaningful global reach. Its top holdings, including industry giants like Apple, Microsoft, NVIDIA, and Oracle, are pivotal to the burgeoning demand for AI infrastructure, cloud computing, and semiconductor technology.

Oracle's Stifel Upgrade

A recent upgrade from Stifel on Oracle, with a Buy rating and a projected 19% upside, highlights the critical role of cloud growth in shaping the future of technology. Oracle's cloud revenue is expected to grow at high 30% rates through 2027, serving as a direct tailwind for IXN and reinforcing its position as a key player in the tech landscape.

Resilience of the “Magnificent 7”

The “Magnificent 7” group of tech stocks—comprising Apple, Tesla, Alphabet, Amazon, Microsoft, NVIDIA, and Meta—has seen varied performance in 2025. While four of these stocks lagged year-to-date, Microsoft and NVIDIA have outperformed, with gains of 13% and 6%, respectively. These two companies represent roughly 40% of IXN's holdings and anchor its narrative around AI-driven innovation and growth.

Contrasting with Semiconductor Sector Weakness

While IXN thrives, the semiconductor sector finds itself under increasing pressure. Hedge funds have dramatically reduced their exposure to semiconductors, cutting allocations to a mere 16.4%—the lowest in five years. This shift stems from concerns regarding overvaluation, ongoing trade wars, and delays in the monetization of AI technologies. The VanEck Semiconductor ETF (SMH) has significantly underperformed IXN, lagging behind by approximately 20% since April 2025, further emphasizing the risks associated with sector-specific investments.

Why IXN is Safer

1. Diversification: IXN provides a diversified exposure, minimizing risks associated with overconcentration in the volatile semiconductor sector while capturing the broader impact of AI across software, cloud, and enterprise technology.
2. Defensive Plays: The ETF includes holdings like Palantir, which specializes in cybersecurity, and ServiceNow, focused on AI-driven IT solutions. These companies align with the evolving market dynamics and the ongoing shift toward AI integration in revenue-generating activities.

Stifel's IGT/BRSL Buy Rating: A Microcosm of Tech's Evolution

Stifel's Buy rating on IGT, which has transitioned to BRSL, reflects a broader trend in the technology sector: a shift from hardware to services. Despite facing near-term earnings misses, IGT's $4.05 billion divestiture of its gaming unit to Apollo Global Management has unlocked substantial shareholder returns, totaling approximately $1.1 billion through special dividends and stock buybacks. This strategic maneuver mirrors IXN's focus on investing in cash-rich and capital-efficient technology firms, further reinforcing the ETF's potential for sustained growth.

Risk Management: Low Daily Volatility, High Upside

IXN's low daily risk profile, with volatility consistently below 1.5%, sets it apart from the broader tech sector, which often experiences more pronounced price swings. The ETF benefits from a significant buffer of 9.55% between current prices and key support, providing a margin of safety for investors. Even in the event of short-term dips, such as those potentially triggered by macroeconomic uncertainty, the support level at $84.42 presents a compelling buying opportunity.

Investment Thesis: Buy IXN for AI's Long Game

Why Buy Now?

1. Technicals: The ETF is on a bullish trend, backed by strong support levels and a projected annualized upside of 31.56%.
2. Fundamentals: IXN is anchored in AI-driven growth stories from leading companies such as Oracle and Microsoft, while effectively avoiding the volatility plaguing the semiconductor sector.
3. Valuation: With a trading valuation of approximately 25x forward earnings, IXN presents a reasonable investment given its growth trajectory and sector dynamics.

Action Items:

• Buy IXN: For a 3 to 6-month investment horizon, targeting a price range of $116 to $127 by September 2025.
• Stop-Loss: Implement a stop-loss strategy at $89.99 to manage potential downside risks.
• Hedge: Consider pairing IXN with a small short position in SMH to mitigate risks associated with semiconductor market fluctuations.

Final Take

The volatility within the tech sector reflects an ongoing evolution rather than a sign of weakness. IXN's blend of technical strength, AI-driven fundamentals, and diversified exposure positions it as a standout investment for those prepared to navigate the complexities of the technology landscape. As Stifel's analysts wisely advise, “Let the trend be your friend,” and for investors looking to capitalize on the next wave of technological advancements, IXN presents a compelling opportunity.

FAQ

What is the iShares Global Tech ETF (IXN)?

The iShares Global Tech ETF (IXN) is an exchange-traded fund that seeks to track the performance of the S&P Global 1200 Information Technology Index, providing exposure to a broad range of technology companies worldwide.

Why is IXN considered a strong buy?

IXN is viewed as a strong buy due to its impressive performance, bullish technical indicators, diversified holdings in leading tech firms, and its resilience against sector-specific volatility, particularly in semiconductors.

What are the top holdings in IXN?

The top holdings in IXN include major technology companies such as Apple, Microsoft, NVIDIA, and Oracle, which are integral to advancements in AI, cloud computing, and other emerging technologies.

How does IXN manage risk?

IXN manages risk through diversification across various tech sectors, maintaining low daily volatility compared to the broader market, and establishing key support levels to provide a buffer against potential price downturns.

What is the projected upside for IXN?

Analysts forecast a 31.56% increase in IXN's value over the next three months, targeting a price range between $116.72 and $126.93 by September 2025, making it an attractive investment opportunity.