Does a $15 Million QTEC Sale Signal Caution Around Overheated AI and Chip Stocks?

On May 8, 2026, NewSquare Capital reported selling 64,705 shares of the First Trust NASDAQ-100-Technology Sector Index Fund (NASDAQ:QTEC), an estimated $14.80 million transaction based on average quarterly pricing.

What happened

According to a filing with the Securities and Exchange Commission dated May 8, 2026, NewSquare Capital reduced its position in the First Trust NASDAQ-100-Technology Sector Index Fund by 64,705 shares. The estimated value of the shares sold was approximately $14.80 million, calculated using the mean unadjusted closing price for the first quarter of 2026. The quarter-end value of the stake fell by $14.92 million, reflecting both the reduction in shares and changes in the fund’s price.

What else to know

• After this sale, the QTEC stake comprises just 0.03% of NewSquare Capital LLC’s reportable 13F assets under management.
• Top five holdings after the filing:
  • NYSEMKT:VTI: $116,936,114 (10.2% of AUM)
  • NYSEMKT:VEU: $66,554,275 (5.8% of AUM)
  • NYSEMKT:SCHX: $60,301,092 (5.3% of AUM)
  • NYSEMKT:IJH: $33,458,997 (2.9% of AUM)
  • NASDAQ:BND: $31,748,265 (2.8% of AUM)
• As of May 7, 2026, QTEC shares were priced at $285.77, up nearly 60% over the past year and well outperforming the S&P 500, which is instead up about 30% in the same period.

ETF overview

ETF snapshot

• QTEC’s investment strategy seeks to replicate the price and yield performance of the Nasdaq-100 Technology Sector Index, providing investors with targeted exposure to leading technology companies.
• The fund seeks to replicate the performance of the Nasdaq-100 Technology Sector Index, which is composed of technology sector equities.
• Structured as an exchange-traded fund, QTEC offers investors exposure to the Nasdaq-100 Technology Sector Index.

The First Trust NASDAQ-100-Technology Sector Index Fund (QTEC) is designed to provide investors with efficient access to the technology segment of the Nasdaq-100, leveraging an equal-weighted approach for diversification. With a market capitalization of $3.3 billion, QTEC offers exposure to a broad array of established and emerging technology leaders. The fund’s index-tracking strategy and liquid ETF structure make it suitable for institutional investors seeking targeted growth within the technology sector.

What this transaction means for investors

QTEC had surged nearly 60% over the past year through May 7, dramatically outperforming the broader market, and NewSquare reduced the position to just 0.03% of assets under management after the trim last quarter.

That timing makes sense given how concentrated the rally has become. QTEC is heavily exposed to semiconductors and software, with those two groups accounting for more than 70% of industry exposure. Top holdings include Intel, AMD, Seagate, Marvell, Arm Holdings, and Qualcomm. The ETF also trades at relatively rich valuations, with a price-to-earnings ratio above 38.

Importantly, QTEC’s equal-weighted structure gives investors broader exposure across Nasdaq technology companies instead of concentrating heavily in megacaps like many AI-focused funds. The ETF returned nearly 50% over the last year through April 30, well ahead of the S&P 500’s 31% gain.

With that in mind, this sale does seem to look like disciplined profit-taking after a huge run in technology stocks. It’s certainly not a broad retreat from equities, but it does signal some potential caution around high-flying pockets of the market.

Jonathan Ponciano has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Vanguard International Equity Index Funds - Vanguard Ftse All-World ex-US ETF and Vanguard Total Bond Market ETF. The Motley Fool has a disclosure policy.