Stocks opened flat to mixedThursday as negotiations continued in Washington over avoiding the taxincreases and spending cuts of the "fiscal cliff."
On Wednesday, Apple stock dragged down the Nasdaq composite index.
Apple,once the stock market's darling, fell another 1.97% Thursday, Itdropped 6.4% Wednesday to close at $538.79. The electronics maker isdown 24% from its September high.
If you bought a technology ETFto diversify your tech holdings, though, you may have noticed thatApple's woes are yours as well. And that's because Apple is such a bigslice of the largest technology ETFs.
Powershares QQQ, Qubes, as they're called, have 18.8% of their assets in Apple, according to Morningstar. QQQ fell 1.1% Wednesday.
Technology Sector Select SPDR has 19.2% of its assets in Apple. It fell 1.0% Wednesday.
Vanguard Information Technology ETF, 20.5% in Apple. It fell 1.0% Wednesday.
IShares Dow Jones U.S. Techology has 22.9% in Apple. The fund fell 1.3% Wednesday.
Thesefunds' huge positions in Apple point to a problem with indexing in astock sector, especially when the index gives greater weight to stockswith larger market capitalization - stock price multiplied by sharesoutstanding.
Even after Wednesday, Apple is a behemoth, weighingin at $506.8 billion. Rival Microsoft, the second-largest holding inQQQ, has a market cap of $224.5 billion. The tech sector is so top-heavyby cap weighting that the five largest members of the Nasdaq 100 indexare 41.5% of the index. But if you buy a tech ETF, your biggest slice byfar is Apple.