Why Tech Growth Could Be Here to Stay

It’s certainly no secret at this point that many investors have leaned on the tech sector as a significant driver of growth in the past few years.

There’s certainly a good reason why investors have chosen to do so. After all, for well over two decades now, the Information Technology sector has been the dominant force of the S&P 500.

Tech’s dominance isn’t just powered by historical precedence, either. The sector continues to push forward in innovation, especially when it comes to artificial intelligence and cloud computing.

However, some still worry that the good times can’t last forever. Expanding tech valuations may have contributed to strong gains recently, but some wonder if these numbers will eventually dip back towards their historical average.

In our view, these worries about near-term valuations don’t tell the whole story for tech, however. We believe the sector is still potentially in a prime position to deliver dynamic growth through product innovation and AI adaptation. This could continue to play out as AI adoption grows and the need for more AI infrastructure mounts.

CNEQ: A Diversified Take on Large-Cap Tech

As such, adopting a large-cap strategy that tilts towards the tech sector could provide a potential path forward. To help gain tech exposure in a more disciplined manner, consider the Alger Concentrated Equity ETF (CNEQ).

An actively managed fund, CNEQ looks to tap into long-term growth by investing in a highly-disciplined portfolio of 30 holdings or less. This small-size portfolio, combined with the flexibility of active management, can help CNEQ’s portfolio team locate the companies that possess the most compelling potential for long-term results.

At face value, one may wonder how CNEQ could slot into an advisor’s portfolio as a tech holding. However, despite being sector-agnostic, over 50% of the fund’s portfolio weight is allocated into the information technology sector, as of September 30, 2025.

In terms of tech exposure, CNEQ invests in many of the names that are currently leading the way in the technology space, especially when it comes to capitalizing on growth opportunities in artificial intelligence. This includes companies like Nvidia, Microsoft, Alphabet, and Meta, among others.

However, the remainder of the fund remains invested in other stocks outside the tech sector that still offer distinct long-term growth potential. For instance, CNEQ holds exposure to stocks like Robinhood and Constellation Energy. These companies offer different routes to capital appreciation, ensuring CNEQ isn’t necessarily beholden to the tech sector to see compelling results.

On the topic of results, CNEQ has presented a strong report card this year. As of October 7, 2025, the fund’s NAV has risen 36.26% year-to-date. This strong performance showcases why CNEQ could serve as a potential solution for advisors willing to bet on continued long-term potential in the tech sector.

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Click here for standard performance and more information on the Alger Concentrated Equity ETF.

Performance data quoted represents past performance and is no guarantee of future results. DUE TO MARKET VOLATILITY, CURRENT PERFORMANCE MAY BE DIFFERENT THAN THE FIGURES SHOWN. Investment return and principal value will fluctuate so that an investor’s shares, when sold in the secondary market, may be worth more or less than original cost. Returns less than one year are not annualized. Performance does not reflect the deduction of commissions, which a broker may charge to execute a transaction in Fund shares, and an investor may incur the cost of the spread between the price at which a dealer will buy shares and the price at which a dealer will sell shares. Market performance is determined using the official closing price on the New York Stock Exchange. Market performance does not represent the returns you would receive if you traded shares at other times. To obtain performance data current to the most recent month end, please visit www.alger.com. Index performance does not represent the fund’s performance. Investors may not invest directly in an index.

Performance shown is net of fees and expenses.

The views expressed are the views of Fred Alger Management, LLC (“FAM”) and its affiliates as of October 2025. These views are subject to change at any time and may not represent the views of all portfolio management teams. They should not be interpreted as a guarantee of the future performance of the markets, any security or any funds managed by FAM. These views are not meant to provide investment advice and should not be considered a recommendation to purchase or sell securities. Holdings and sector allocations are subject to change. Past performance is not indicative of future performance.

Risk Disclosures: Investing in the stock market involves risks, including the potential loss of principal. Growth stocks may be more volatile than other stocks as their prices tend to be higher in relation to their companies’ earnings and may be more sensitive to market, political, and economic developments. A significant portion of assets will be concentrated in securities in related industries, and may be similarly affected by adverse developments and price movements in such industries. A significant portion of assets may be invested in securities of companies in related sectors, and may be similarly affected by economic, political, or market events and conditions and may be more vulnerable to unfavorable sector developments. The Fund is classified as a “non-diversified fund” under federal securities laws because it can invest in fewer individual companies than a diversified fund. Active trading may increase transaction costs, brokerage commissions, and taxes, which can lower the return on investment. At times, cash may be a larger position in the portfolio and may underperform relative to equity securities. ETF shares are based on market price rather than net asset value (“NAV”), as a result, shares may trade at a price greater than NAV (a premium) or less than NAV (a discount). The Fund may also incur brokerage commissions, as well as the cost of the bid/ask spread, when purchase or selling ETF shares. The Fund faces numerous market trading risks, including the potential lack of an active market for Fund shares, losses from trading in secondary markets, periods of high volatility and disruption in the creation and/or redemption process of the Fund. Any of these factors, among others, may lead to the Fund’s shares trading at a premium or discount to NAV. Thus, you may pay more (or less) than NAV when you buy shares of the Fund in the secondary market, and you may receive less (or more) than NAV when you sell those shares in the secondary market. The Manager cannot predict whether shares will trade above (premium), below (discount) or at NAV. The Fund may effect its creations and redemptions for cash, rather than for in-kind securities. Therefore, it may be required to sell portfolio securities and subsequently recognize gains on such sales that the Fund might not have recognized if it were to distribute portfolio securities in-kind. As such, investments in Fund shares may be less tax-efficient than an investment in an ETF that distributes portfolio securities entirely in-kind. Brokerage fees and taxes will be higher than if the Fund sold and redeemed shares in-kind. Certain shareholders, including other funds advised by the Manager or an affiliate of the Manager, may from time to time own a substantial amount of the shares of the Fund. Redemptions by large shareholders could have a significant negative impact on the Fund.

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The S&P indexes are a product of S&P Dow Jones Indices LLC and/or its affiliates and has been licensed for use by Fred Alger Management, LLC and its affiliates. Copyright 2025 S&P Dow Jones Indices LLC, a subsidiary of S&P Global Inc. and/or its affiliates. All rights reserved. Redistribution or reproduction in whole or in part are prohibited without written permission of S&P Dow Jones Indices LLC. S&P® is a registered trademark of Standard & Poor’s Financial Services LLC and Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC. Neither S&P Dow Jones Indices LLC, Dow Jones Trademark Holdings LLC, their affiliates nor their third party licensors make any representation or warranty, express or implied, as to the ability of any index to accurately represent the asset class or market sector that it purports to represent and neither S&P Dow Jones Indices LLC, Dow Jones Trademark Holdings LLC, their affiliates nor their third party licensors shall have any liability for any errors, omissions, or interruptions of any index or the data included therein.

Investors cannot invest directly in any index. The performance data quoted represents past performance, which is not an indication or a guarantee of future results.

The following positions represented the noted percentages of CNEQ assets as of July 31, 2025: Nvidia Corporation: 15.58%; Microsoft Corporation: 11.02%; Alphabet Inc. Class C: 3.39%; Meta Platforms Inc Class A: 6.19%; Robinhood Markets, Inc. Class A: 1.81%; Constellation Energy Corporation: 2.98%.

Before investing, carefully consider a Fund’s investment objective, risks, charges, and expenses. For a prospectus and summary prospectus containing this and other information or for a Fund’s most recent month-end performance data, visit  www.alger.com, call (800) 992-3863 (for a mutual fund) or (800) 223-3810 (for an ETF), or consult your financial advisor. Read the prospectus and summary prospectus carefully before investing. Distributor: Fred Alger & Company, LLC. All underlying series of The Alger ETF Trust listed on NYSE Arca, Inc. NOT FDIC INSURED. NOT BANK GUARANTEED. MAY LOSE VALUE.

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