Is It Really Safe to Invest in a Tech ETF Right Now? History Has Good and Bad News.

Tech stocks have been among the best ways to make money in the market over the past decade, but with the current AI mania and many of them seeing their valuations skyrocket, many investors are worried about whether it's a bubble or a correction is inevitable.

One of the best ways to navigate right now is to invest in a tech ETF, but those haven't been immune to volatility either. Considering the growth potential, yet potential downside, is now a good time to invest in a tech ETF? History has good and bad news, but a clear answer.

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Down, but never completely out

Tech stocks can be a tale of two sides. On one side, no other sector has seen the growth tech has, and those stocks have made many investors a lot of money. On the other side, when the tech sector hits a rough patch, it tends to be rougher than the broader market.

It can get ugly, but they're never permanently down. Let's take two popular tech ETFs, the Invesco QQQ Trust ETF (NASDAQ: QQQ) and the Vanguard Information Technology ETF (NYSEMKT: VGT), as examples.

During the dot-com crash, QQQ declined by over 80% from March 2000 to October 2022, by over 53% during the financial crisis, by 33% during the 2022 bear market, and by more than 23% just last year during the early stages of the Trump administration's 2025 tax tariff fiasco. Yet, it's up around 3,420% since the dot-com crash, and over 67% since its 2025 bottom.

VGT declined by over 54% during the financial crisis, 32% during the COVID-19 crash, 30% during the 2022 bear market, and 26% during the 2025 tax shock. And, similar to QQQ, it's up considerably since those down periods.

VGT data by YCharts. Grey vertical bars represent U.S. recessions.

Most people should continue investing in tech ETFs

If you're looking for a get-rich-quick investment or an ETF that'll double your money in a year, you're likely to be disappointed by a tech ETF. If you're a long-term investor, then the answer is undoubtedly a yes; it's a safe time to invest in a tech ETF. That doesn't mean it won't be volatile or experience a drop. It just means that's likely to be a great way to grow your money over time.

Large tech companies are some of the world's most dominant businesses, and that's likely to be the case for quite some time. The sector as a whole has become so ingrained in our daily lives that its long-term trajectory is bound to be positive.

If you're worried about a sudden drop or correction, I would recommend dollar-cost averaging, which involves investing consistent amounts at regular intervals versus a lump sum. Both QQQ and VGT are great options, but it depends on whether you want a pure-play tech ETF (VGT) or a tech-focused ETF that has a sprinkle of other sectors (QQQ).

Stefon Walters has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.