Is It Time to Buy IGV and sell SOXX?

"Buy IGV $iShares Expanded Tech Software Sector ETF(IGV.US)and sell SOXX$iShares Semiconductor ETF(SOXX.US)" trend is a temporary interest rate driven rotation. Trying to dance between hardware and software sectors during a bond market panic is not a good move.

Why?

While it is true that software delivered its strongest single day performance against chipmakers in 25 years, this is not the death of silicon. The extreme cash generation from data center buildouts is still backing semiconductor fundamentals. Software applications can only grow as fast as the hardware chips allow them to compute.

While tech valuations drop when the 10 year Treasury yield hit over 5%, SOXX $iShares Semiconductor ETF(SOXX.US)has already undergone a massive valuation reset down to 20x forward earnings. It is no longer dangerously overpriced.

The Bottom Line

Don't get caught in Wall Street's daily musical chairs. Ignore the temporary software vs hardware rotation headlines. Continue to dollar cost average into QQQM $Invesco Nasdaq 100 ETF(QQQM.US) is the way to go for the long term investor.

It is time in the market that counts, not timing the market.