What a Time to Run This T. Rowe Price Tech Fund

A penchant for semiconductor stocks amid the AI boom is boosting returns for the T.

Rowe Price Global Technology Fund. When you purchase through links on our site, we may earn an affiliate commission. Here’s how it works. Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.You are now subscribedYour newsletter sign-up was successfulWant to add more newsletters?Delivered dailyKiplinger TodayProfit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more delivered daily. Smart money moves start here.Sent five days a weekKiplinger A Step AheadGet practical help to make better financial decisions in your everyday life, from spending to savings on top deals.Delivered dailyKiplinger Closing BellGet today's biggest financial and investing headlines delivered to your inbox every day the U.S. stock market is open.Sent twice a weekKiplinger Adviser IntelFinancial pros across the country share best practices and fresh tactics to preserve and grow your wealth.Delivered weeklyKiplinger Tax TipsTrim your federal and state tax bills with practical tax-planning and tax-cutting strategies.Sent twice a weekKiplinger Retirement TipsYour twice-a-week guide to planning and enjoying a financially secure and richly rewarding retirementSent bimonthly.Kiplinger Adviser AngleInsights for advisers, wealth managers and other financial professionals.Sent twice a weekKiplinger Investing WeeklyYour twice-a-week roundup of promising stocks, funds, companies and industries you should consider, ones you should avoid, and why.Sent weekly for six weeksKiplinger Invest for RetirementYour step-by-step six-part series on how to invest for retirement, from devising a successful strategy to exactly which investments to choose. Dominic Rizzo, manager of the T.

Rowe Price Global Technology Fund (PRGTX), loves his job. "It's exciting. This is the moment for technology," he says. Since taking over Global Technology in late 2022, he has delivered a 33% annualized return, ahead of the 24% average gain of tech-fund peers.Rizzo favors companies with linchpin technologies in innovative, growing markets, among other things. Roughly half of its assets are invested in semiconductor stocks, such as Advanced Micro Devices (AMD) and Broadcom (AVGO), that are benefiting from the boom in spending on artificial intelligence (AI)."That's been the right call," he says, and it's a big driver of the fund's 30% 12-month return, which beat 73% of its peers.Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special IssuesProfit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.Profit and prosper with the best of expert advice - straight to your e-mail.Rizzo has trimmed some top holdings, including Apple (AAPL) and Microsoft (MSFT), in part to raise cash for new investments — Samsung Electronics (SSNLF), a memory-chip giant, and Datadog (DDOG), a cloud-based infrastructure-and application-monitoring company, are two.But, he says, "we remain AI 'on' and semiconductor 'on,'" adding that these stocks aren't overpriced."People underestimate how much earnings are climbing for so many of these companies." Some top gainers, including Nvidia (NVDA), trade at a price/earnings-to-growth ratio, called the PEG ratio, of less than one, which is generally viewed as a sign that a stock is undervalued."I still think AI is bigger than people think," Rizzo says, adding that he expects the AI chip market to grow from $45 billion in 2023 to $500 billion in 2028 and $1 trillion in 2030.PRGTX, a member of the Kiplinger 25, our favorite no-load mutual funds, is an "all-weather fund," says Rizzo. It can be volatile, but no more so than the typical tech fund. And in recent stretches when stocks have stumbled, the fund has held up better than its peers.Loading up on mega caps helps dampen the fund's volatility, he says. So does spreading his investments across the globe (30% of the portfolio's holdings are non-U.S. stocks) and to other tech industries. That allows the fund to take a flier on some private AI companies, with stakes in OpenAI, Anthropic and Databricks.Note: This item first appeared in Kiplinger Personal Finance Magazine, a monthly, trustworthy source of advice and guidance. Subscribe to help you make more money and keep more of the money you make here.Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.Nellie joined Kiplinger in August 2011 after a seven-year stint in Hong Kong. There, she worked for the Wall Street Journal Asia, where as lifestyle editor, she launched and edited Scene Asia, an online guide to food, wine, entertainment and the arts in Asia. Prior to that, she was an editor at Weekend Journal, the Friday lifestyle section of the Wall Street Journal Asia. Kiplinger isn't Nellie's first foray into personal finance: She has also worked at SmartMoney (rising from fact-checker to senior writer), and she was a senior editor at Money.