iShares US Digital Infrastructure and Real Estate ETF

IDGT

Market cap $196M

Markets may have priced in peak Iran war fears. With volatility easing, low P/E, high-momentum ETFs are emerging as smart bets for near-term gains.

IDGT, WCBR, UTES, BDRY, MKOR & RING led last week's ETF gains as AI rotation, Japan optimism, shipping strength and defensive demand drove standout performance.

IDGT provides diversified exposure to communications equipment, telecom tower REITs, data centers, and semiconductors tied to AI, 5G, and cloud growth. Data centers and semiconductors drive higher growth, while REITs and equipment add stability and yield. The fund has a competitive expense ratio but weaker liquidity than peer DTCR, creating potential bid-ask spread risks.

CNBC's Dom Chu joins 'Squawk on the Street' to discuss data center REITs amid the push for AI-powered data centers.

iShares U.S. Digital Infrastructure and Real Estate ETF (IDGT) focuses on communication equipment, tower REITs, and data center REITs, with a concentrated portfolio. IDGT has excellent cash flow characteristics but shows lower historical returns and higher volatility compared to broad market and sector benchmarks. IDGT outperforms other digital infrastructure ETFs due to higher technology sector exposure.

Tech leaders gathered at the White House to announce the Stargate Project. This is a new venture that plans to invest $500 billion over the next four years on AI infrastructure and data centers.

Investors can take advantage of beaten-down prices because the second Trump administration is likely to boost stocks.

Halfway through the year, thematic equity ETFs have exhibited wide levels of dispersion but continue to capture the market's attention heading into the second half of 2024.

In its latest report released last December, the Bureau of Economic Analysis (BEA) estimates that the digital economy now represents 10% of the total U.S. GDP, or $2.6 trillion.  The digital economy is also growing at an average annual growth rate of 7.1%.

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