Software ETF Drops 22% While Underperforming S&P 500 ETF by 21%
Software stocks underperformed the SPDR S&P 500 ETF Trust by a record 21% over four weeks as the Expanded Tech-Software Sector ETF dropped 22%. Investors can also seek defensive yields via ETFs like SWAN, which allocates 10% to SPDR S&P 500 call options for upside while holding 90% Treasurys.
1. Historic Software Sector Underperformance
The Expanded Tech-Software Sector ETF plunged 22% over four consecutive weeks, marking its worst drawdown since the pandemic. During this stretch, the SPDR S&P 500 ETF Trust outperformed by 21%, a record gap driven by AI disruption fears and broad multiple compression rather than fundamental deterioration.
2. SWAN ETF’s SPY Call Option Strategy
The Amplify BlackSwan Growth & Treasury Core ETF holds 90% in U.S. Treasurys and 10% in in-the-money SPDR S&P 500 ETF call options, offering downside protection while retaining market upside exposure. The fund yields 2.86% and charges a 0.49% expense ratio, appealing to defensive investors seeking SPY-linked gains.