Investors with little or no exposure to artificial intelligence (AI) stocks like Nvidia and Palantir probably underperformed the S&P 500 in 2025. AI will likely remain a key driver of stock market returns in 2026, and the iShares Expanded Tech Sector ETF offers broad exposure to the entire industry. The iShares ETF has outperformed the S&P 500 every year since its inception in 2001, and I predict more of the same in 2026.
## America’s best tech stocks packed into one ETF
The iShares Expanded Tech Sector ETF holds 291 stocks. It focuses on the technology sector, but it also invests in tech-adjacent companies from the communication services and consumer discretionary sectors. Zooming in even further, almost 27% of the value of its entire portfolio is parked in semiconductor stocks, which supply the data center chips and components powering the AI boom.
Several of the world’s best semiconductor stocks have made it into the iShares ETF’s top 10 holdings, where they sit alongside many leading developers of AI platforms and software:
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| Stock | iShares ETF Portfolio Weighting |
| — | — |
| 1. **Nvidia** | 8.92% |
| 2. **Microsoft** | 8.87% |
| 3. **Apple** | 8.55% |
| 4. **Alphabet** | 8.54% |
| 5. **Broadcom** | 7.37% |
| 6. **Meta Platforms** | 4.67% |
| 7. **Palantir Technologies** | 2.55% |
| 8. **Netflix** | 2.42% |
| 9. **Advanced Micro Devices** | 2.13% |
| 10. **Micron Technology** | 2.01% |
Data source: iShares. Portfolio weightings are accurate as of Dec. 29, 2025, and are subject to change.
Considering those 10 stocks alone have a combined weighting of 56%, they have a significant influence over the ETF’s performance. They delivered an average return of 66% in 2025, so it’s no surprise the ETF comfortably beat the S&P 500.
## BlackRock’s massive ETF empire
BlackRock is the world’s largest asset manager, with $13.5 trillion in client funds in its custody. Around $5 trillion of that total is spread across over 1,600 exchange-traded funds (ETFs) managed by the company’s iShares subsidiary. One of them is the iShares Expanded Tech Sector ETF, which has a concentrated portfolio of technology stocks that includes many of the giants leading the artificial intelligence (AI) race. It soared by 27.5% in 2025, comfortably outpacing the 17.5% return in the S&P 500.
But last year’s result wasn’t a one-off, because the iShares ETF has beaten the S&P 500 every year (on average) since its inception in 2001. I predict it will outperform yet again in 2026, thanks to its massive exposure to the booming AI sector. As the world’s best tech stocks continue to drive growth and innovation, the iShares Expanded Tech Sector ETF is likely to remain a top performer in the years ahead.
