Technology stocksare perennially one of the hottest areas of the stock market. Investors closely follow this sector because of its track record of scorching returns and the potential for more in the future. So it can be worth keeping an eye on tech stocks and tracking the hot performers.
While a list of best performers won’t tell you which stocks will do well in the future, many top tech performers continue to deliver strong returns for years. For example, Amazon has put up serious gains in past years, so it can be useful to follow the best tech stocks to see which will continue their high-growth ways.
Below are the best-performing tech stocks in 2023, which includes exclusively tech stocks from the Technology Select Sector SPDR Fund ETF (XLK). While 2022 was a challenging one for equities, many tech stocks bounced back strongly in 2023.
Best tech stocks as of January 2024
| Company and ticker symbol | Performance in 2023 |
|---|---|
| NVIDIA (NVDA) | 238.9% |
| Advanced Micro Devices (AMD) | 127.6% |
| Palo Alto Networks (PANW) | 111.3% |
| Broadcom (AVGO) | 99.6% |
| Salesforce (CRM) | 98.5% |
| Fair Isaac Corporation (FICO) | 94.5% |
| Arista Networks (ANET) | 94.1% |
| Intel (INTC) | 90.1% |
| Jabil (JBL) | 86.8% |
| Lam Research (LRCX) | 86.4% |
Data as of Dec. 29, 2023
It can also be worthwhile keeping an eye on some of tech’s laggards, too. Why? Sometimes the reason a stock might be underperforming is because it skyrocketed the year before. So investors need time to digest the good news, and the underlying business needs time to catch up to the stock price. So this year’s underperforming stock could well become a darling again next year.
Below are the worst-performing tech stocks from the same fund.
Worst-performing tech stocks as of January 2024
| Company and ticker symbol | Performance in 2023 |
|---|---|
| Enphase Energy (ENPH) | -50.1% |
| EPAM Systems (EPAM) | -9.3% |
| Juniper Networks (JNPR) | -7.8% |
| Keysight Technologies (KEYS) | -7.0% |
| Corning (GLW) | -4.7% |
Data as of Dec. 29, 2023
Widely held tech stocks
Here’s how some of the most widely held tech stocks have performed.
| Company and ticker symbol | Performance in 2023 |
|---|---|
| Apple (AAPL) | 48.2% |
| Microsoft (MSFT) | 56.8% |
| Alphabet (GOOGL) | 58.3% |
| Amazon (AMZN) | 80.9% |
| Tesla (TSLA) | 101.7% |
Data as of Dec. 29, 2023
Should you invest in the hottest tech stocks?
Investing in individual stocks can be tough. You need to understand the business and the industry, and know where they’re heading. With tech stocks, that means you may need to research and understand many complex things. For those who have the time and willingness to invest the energy into doing it, they may be able to get some of these great returns.
Is everyone else out of luck? Nope. In fact, any investor can take part in the rising tech industry, even with just a little knowledge. That’s because investors have the ability to buy index funds based on whatever sector of the market they want. These funds track a specific collection of stocks and don’t try to beat the market but instead get the weighted average of their holdings.
So if you’re looking for tech stocks, consider mutual funds or exchange-traded funds that focus exclusively on the technology sector. You’ll have a wide assortment of funds, ranging from exclusively tech-focused funds to those with a huge allocation to tech, such as an index fund based on the Nasdaq Composite index, a collection of thousands of stocks trading on the Nasdaq exchange.
But a key for whatever you invest in: If you don’t hold onto your stock or fund, you won’t get the returns that it could offer. That’s one reason that passive investing often trumps active trading.
Bottom line
Tracking the hottest tech stocks is a good way to find out what the market likes, but if you want to go out and invest in some of these names, it’s important that you research the business and understand what you’re actually buying. And you’re under no obligation to buy anything you don’t like. As legendary investor Warren Buffett once said, “The stock market is a no-called-strike game. You don’t have to swing at everything — you can wait for your pitch.”
Editorial Disclaimer: All investors are advised to conduct their own independent research into investment strategies before making an investment decision. In addition, investors are advised that past investment product performance is no guarantee of future price appreciation.
