Searching for Pure Technology Plays

Options on the Amex Computer Technology Index, or XCI, also trade on the American Stock Exchange. This index is designed to represent a cross section of widely held U.S. companies involved in various phases of the computer industry. XCI options do not see much trading activity.

Finally, the Chicago Board Options Exchange provides options trading in the CBOE Technology Index, or TXX. This index includes 30 large-cap technology companies. Like the XCI, however, the CBOE Technology Index options see little trading activity and therefore are not very liquid.

As you can see, there are a variety of ways to play the technology sector outside the QQQs. Unlike the Nasdaq 100, these are pure plays on technology and don't offer exposure to other sectors like retailing, biotechnology or energy. The liquidity of these investment vehicles will vary, and the most actively traded today is perhaps the Select Sector Technology SPDRs. Nevertheless, traders might want to consider all of their options before placing bets on the technology sector with the more actively traded QQQs.