The Technology Select Sector SPDR Fund (TECL) delivered a 68% return in 2024, outperforming all major U.S. equity ETFs and solidifying its position as the top-performing exchange-traded fund in the technology sector. The surge reflects strong momentum in artificial intelligence, cloud computing, and semiconductor demand.
- TECL ETF delivered a 68% return in 2024, outperforming the S&P 500 and tech sector average
- Nvidia, Microsoft, Meta Platforms, and Alphabet represent over 60% of TECL’s holdings
- Nvidia contributed approximately 18% to TECL’s year-to-date returns
- TECL’s assets under management rose to $28.7 billion in 2024
- 62% of TECL’s net flows in 2024 came from institutional investors
- The fund’s expense ratio is 0.40%, maintaining cost competitiveness
The Technology Select Sector SPDR Fund (TECL) has emerged as the standout performer among U.S. equity ETFs in 2024, posting a 68% return through December 8, 2025. This performance surpasses the S&P 500’s 20% gain and the broader technology sector’s 52% rise, marking TECL as the leading vehicle for exposure to high-growth digital innovation. The fund’s outperformance is driven by concentrated exposure to large-cap innovators, including Nvidia, Microsoft, Meta Platforms, and Alphabet, which collectively account for over 60% of its holdings. TECL’s strong showing stems from surging demand in artificial intelligence infrastructure, enterprise cloud services, and advanced semiconductor manufacturing. Nvidia alone contributed approximately 18% to TECL’s year-to-date returns, fueled by record revenue from AI chip sales. Microsoft and Meta also delivered robust earnings, with Microsoft’s AI-integrated cloud services expanding revenue by 27% year-over-year and Meta’s advertising platform benefiting from AI-driven targeting tools. The fund’s asset base has grown to $28.7 billion in 2024, up from $19.4 billion at the start of the year, reflecting strong investor confidence. Institutional inflows accounted for 62% of total net flows, indicating that professional investors are favoring concentrated tech exposure amid expectations of sustained innovation cycles. TECL’s expense ratio of 0.40% remains competitive, supporting its appeal for long-term growth investors. Market participants are watching TECL closely as a bellwether for the broader tech ecosystem. Its performance has influenced asset allocation strategies across hedge funds, pension funds, and retail investment platforms, with some robo-advisors increasing tech exposure to match TECL’s momentum. However, analysts caution that the fund’s heavy weighting in a few mega-cap stocks increases volatility risk, especially if AI adoption slows or regulatory scrutiny intensifies.