TECY attempts to squeeze income from the tech sector by overweighting the few technology companies that actually pay meaningful dividends. It's targeting yield-hungry investors who want tech exposure but can't stomach the zero-dividend reality of most growth stocks.
How It Works
The fund appears to use a yield-weighted approach, concentrating holdings in mature tech companies with established dividend programs like Microsoft, Oracle, and IBM. This creates a radically different portfolio than market-cap weighted tech funds — essentially betting on cash-rich legacy players over high-growth disruptors. The YieldBOOST methodology likely employs dividend screens and rebalances based on yield changes.
Key Features
- Concentrates in rare dividend-paying tech names, avoiding the 70%+ of tech stocks paying nothing
- Yield-weighting creates heavy tilts toward mature, slower-growth companies versus typical tech funds
- Provides tech sector exposure for income portfolios that typically avoid the sector entirely
Risks
- Massive performance gap risk — could lag QQQ by 10-20% annually if growth stocks dominate
- Extreme concentration in handful of dividend payers means single stock blow-ups hurt badly
- Yield chasing in tech often means owning yesterday's winners while missing tomorrow's
Who Should Own This
Best for retirees or income-focused investors who want some tech allocation but refuse to own non-dividend stocks. Also works for contrarian value players betting that profitable, cash-generative tech will outperform unprofitable growth. Anyone chasing tech sector returns should look elsewhere — this is about income, not growth.