The BetaShares Nasdaq 100 ETF (NDQ) just hit a new all-time high. Here’s why

Last month, we discussed whether it was too late to buy the BetaShares Nasdaq 100 ETF (ASX: NDQ) at close to what was then a new record high.

Since then, we’ve seen this ASX exchange-traded fund (ETF) push even higher, decisively answering that redundant question with a ‘no’.

Today, we’ve seen ASX NDQ units do it again. This ETF closed at $38.16 a unit yesterday afternoon. But this morning, those same units climbed up to $38.31 each. That’s a new record high that is more than 2% above where the Betashares Nasdaq 100 ETF was last month when we first asked whether it was too late to buy.

Today’s gains put NDQ units up 2.44% year to date, as well as up an extraordinary 49.65% over the past 12 months.

So why is this popular ETF sitting at another new high today?

Why has the BetaShares NDQ ETF just hit a new ASX record high?

Well, to answer that, let’s look at what this ETF actually invests in. Like many ETFs, NDQ is an index fund. In this case, the index that it tracks is the NASDAQ-100 Index (INDEXNASDAQ: NDX). This index covers the largest 100 non-financial shares on the American Nasdaq stock exchange.

The Nasdaq is famous for housing almost every major US tech stock on the market. That’s everything from Apple, Microsoft and Amazon to Netflix, PayPal and Airbnb.

During last night’s US trading, a few of these companies managed to push higher. Microsoft inched closer to another new record high, gaining 1%. Meta Platforms was up 1.3%. Although other Nasdaq tech stocks like Apple, Amazon and NVIDIA fell slightly, it seems that those gains from Microsoft and Meta were enough to warrant another rise for NDQ units today.

A fall in the value of the Australian dollar against the US dollar overnight would be helping to push NDQ higher as well.

Investing in index funds

It can be hard to muster enough energy to buy more units of an index fund that is sitting at or near a new record high. However, as we’ve already discussed, investors who got cold feet before today would probably be regretting their previous reluctance.

If you’re following a dollar-cost averaging strategy to invest in NDQ units, it’s important to stick to a consistent investing schedule.

Trying to time the market by waiting for a cheap opportunity to buy an investment is usually a poor strategy to follow. None of us know what an index might do next. The BetaShares Nasdaq 100 ETF could have a terrible year in 2024 for all we know. But it’s equally possible that it has another blowout year.

If you keep in mind that indexes like the Nasdaq 100 tend to go up more often they they go down, the right path is hopefully easier to see.

The post The BetaShares Nasdaq 100 ETF (NDQ) just hit a new all-time high. Here’s why appeared first on The Motley Fool Australia.

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More reading

• 2 no-brainer ASX ETFs for investors to buy and hold
• 5 top ASX ETFs for investors to buy in 2024
• 3 ASX ETFs to buy in 2024 and hold forever
• 3 ASX ETFs to buy after the Christmas break
• Is it too late to buy the BetaShares Nasdaq 100 ETF (NDQ) trading near record highs?

John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Motley Fool contributor Sebastian Bowen has positions in Airbnb, Amazon, Apple, Netflix, PayPal and Microsoft. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Airbnb, Amazon, Apple, BetaShares Nasdaq 100 ETF, Microsoft, Netflix, Nvidia, and PayPal. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: short March 2024 $67.50 calls on PayPal. The Motley Fool Australia has positions in and has recommended BetaShares Nasdaq 100 ETF. The Motley Fool Australia has recommended Airbnb, Amazon, Apple, Netflix, Nvidia, and PayPal. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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