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Tech stocks likely constitute a plurality, if not a majority of your portfolio.
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If you want to diversify before the tech selloff deepens, here are three great options.
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A recent study identified one single habit that doubled Americans’ retirement savings and moved retirement from dream, to reality. Read more here.
Many don’t realize a hidden tech bloodbath is going on, especially as people’s attention is on oil prices and the bigger fish in the market. The S&P 500 Software & Services index is down 25% from October 2025, and that money is going into high-yield dividend ETFs like the VanEck Preferred Securities ex Financials ETF (NYSEARCA:PFXF), Alerian MLP ETF (NYSEARCA:AMLP), and Pacer Emerging Markets Cash Cows 100 ETF (NASDAQ:ECOW).
Software is the bread and butter of tech. If the end user is not buying AI subscriptions, you can argue that big enterprises are going to pour money into AI anyway. But if even Microsoft (NASDAQ:MSFT) and Google (NASDAQ:GOOG, NASDAQ:GOOGL) start to see users cutting back on their subscriptions and ignoring ads, it can spell big trouble. Thus, it is not premature to start taking profits from software stocks. The sector already peaked late last year, and you’re safer off shifting some gains into high-yield dividend ETFs.
Read: Data Shows One Habit Doubles American’s Savings And Boosts Retirement
Most Americans drastically underestimate how much they need to retire and overestimate how prepared they are. But data shows that people with one habit have more than double the savings of those who don’t.
Obviously, you don’t want to sell all tech stocks immediately, but having a more balanced split between growth and safety is essential right now.
Here’s why these three ETFs can help you do that.
This ETF gives you exposure to preferred stocks, without securities from the financial sector. Now, why is this the case? If the AI bubble does blow up, the most acute victims won’t be the tech companies themselves. They are plenty profitable and won’t collapse. The companies that might collapse are the financial institutions linked to private firms that have been propping up unprofitable AI startups all along.
PFXF is smart since preferred stocks have a par value, and if the company does go bankrupt, investors holding these stocks are prioritized. Excluding financials makes this far safer in the current environment. Of course, this does have preferred stocks from tech companies, but any future crash will likely hit their stock market prices. Most software companies sitting on 20-30% margins won’t go bankrupt. This isn’t the Dot Com era, where most tech companies are loss-making.
Thus, I see PFXF as a solid play at the moment. You get a 6.87% dividend yield with a monthly payout frequency. The expense ratio is 0.40%, or $40 per $10,000. Better yet, the ETF itself is up 6.7% in the past year on top of all the dividends.
The Alerian MLP ETF is an energy ETF that is not directly exposed to oil prices. As much as you’d want to cash in on rising oil prices, no one knows if the war is going to abruptly end tomorrow once the president declares victory. Thus, buying indirect names like AMLP can help you have your cake and eat it too.
AMLP gives you exposure to Master Limited Partnerships (MLPs) and midstream energy companies. These companies simply deal with the transportation of oil and gas through their pipelines. They don’t care if oil sits at $100 or $10, because most of their cash comes from fee and volume-based contracts.
Of course, this isn’t the case for all of them. But broadly speaking, AMLP is a more conservative and sensible play on higher oil prices. Exports from the U.S. to Europe are surging as the Strait of Hormuz is closed and the Red Sea remains threatened. The Atlantic is the only true safe route, so pipelines throughout North America are running hot to meet this export demand and the domestic demand.
AMLP is up 11.5% year-to-date already and has a 7.6% dividend yield. The expense ratio is 0.85%. You have virtually no tech exposure with this ETF and plenty of upside.
Pacer Emerging Markets Cash Cows 100 ETF relieves you from one of the most under-estimated traps many dividend investors have fallen into. So, what’s the trap?
It’s the fact that most investors have overlapping exposure to the same handful of tech stocks. Look at the top 10 stocks in the Nasdaq-100 and compare them to the S&P 500. You’ll find very few differences, and both of those indices have become very top-heavy.
Now look at the most popular dividend ETFs. You’ll find many dividend ETFs that use options.
Covered call dividend stocks that are turning the AI and tech rally into “enhanced dividends” are dominating. Their holdings are mirroring those of aggressive growth stocks.
Many investors now have their dividend portfolio made up of… well, more tech. You’re supposed to have genuine dividend ETFs in there, and if you have tech ETFs masked as dividend ETFs in there, your portfolio is vulnerable.
ECOW gives you exposure to 100 solid cash cow companies you’ve likely never heard of. These are strong companies worldwide that have plenty of free cash flow and are paying sustainable dividends. The top holdings will look alien to you, and that’s exactly what you want if you are overinvested in tech.
The ETF is up 26.1% in just the past year and comes with a 4.89% dividend yield. The expense ratio is 0.70%, which is quite low for an international dividend fund that has to juggle so many assets across dozens of countries.
Most Americans drastically underestimate how much they need to retire and overestimate how prepared they are. But data shows that people with one habit have more than double the savings of those who don’t.
And no, it’s got nothing to do with increasing your income, savings, clipping coupons, or even cutting back on your lifestyle. It’s much more straightforward (and powerful) than any of that. Frankly, it’s shocking more people don’t adopt the habit given how easy it is.