Microsoft’s (MSFT) growth prospects look robust, driven by its push into AI, cloud infrastructure, and enterprise software. Its AI-powered tools, such as Copilot, are now used by over 70% of Fortune 500 companies. Also, the tech giant is expanding its AI footprint globally, including a $400 million investment in Switzerland. Thus, investors looking for exposure to MSFT stock may consider investing in these two ETFs: Vanguard Information Technology ETF (VGT) and iShares Global Tech ETF (IXN).
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Let’s take a deeper look at these two ETFs.
Vanguard Information Technology ETF
The VGT ETF provides investors with exposure to technology stocks, including companies in software, semiconductors, internet, and other technology-related sectors. This ETF tracks the MSCI U.S. Investable Market Index/Information Technology 25/50 Index.
MSFT stock constitutes 15.11% of the ETF’s holdings. Apart from MSFT, some of the top stocks in the VGT ETF are Nvidia (NVDA), Apple (AAPL), and Broadcom (AVGO). Overall, the ETF has $94.11 billion in assets under management (AUM). Also, it has an expense ratio of 0.09%. The VGT ETF has returned 38.2% in the past three months.
Turning to Wall Street, the ETF has a Moderate Buy consensus rating. Of the 321 stocks held, 254 have a Buy, 60 have a Hold, and seven have a Sell ratings. At $725.62, the average VGT ETF price target implies a 7.66% upside potential.
iShares Global Tech ETF
The IXN ETF is ideal for long-term growth investors seeking global tech exposure. The ETF aims to track the performance of the S&P Global 1200 Information Technology Index, which includes tech giants from the U.S., Europe, and Asia.
Importantly, MSFT accounts for 17.75% of IXN’s total holdings. Some of the top holdings in IXN ETF include NVDA, Oracle (ORCL), and Palantir (PLTR). Overall, the ETF has $296.33 million in AUM and an expense ratio of 0.68%. Over the past three months, the IXN ETF has generated a return of 37.7%.
On TipRanks, IXN has a Moderate Buy consensus rating based on 88 Buys, 32 Holds, and one Sell assigned in the last three months. At $97.95, the average IXN ETF price target implies 4.95% upside potential.
Concluding Thoughts
ETFs provide indirect exposure to Microsoft, reducing risk compared to investing directly in the stock. Furthermore, ETFs are a liquid and transparent way to participate in the market. Investors seeking ETF recommendations might consider VGT and IXN, as these ETFs offer exposure to MSFT stock.