Want to buy Nvidia Dip? Here are 2 ETFs you should take a look at

Nvidia (NVDA -6.39%) was one of the most impressive bull stocks of all time, but has retreated more than 10% from recent highs. However, with the stock trading at more than 38 times sales even after the decline, many investors may not want to buy Nvidia stock individually.

The best way to get exposure to Nvidia in your stock portfolio might be through an exchange-traded fund (ETF) that has a heavy allocation to the chip-making giant but also owns plenty of other stocks. Here are two in particular that you might want to take a closer look at right now.

A rising tide is lifting all chip makers

Nvidia is certainly the most prolific chipmaker on the market right now, and for good reason, but it’s not the only one benefiting from increased investment in artificial intelligence (AI). The Invesco PHLX Semiconductor ETF (SOXQ -0.48%) it could be a great way to invest.

First, its expense ratio of 0.19% is among the lowest in the semiconductor ETF space and is extremely low for a generally focused index fund.

This is a fairly concentrated ETF with only 30 holdings, all of which are semiconductor manufacturers (chip makers). As you might expect, large companies make up the bulk of the holdings, but more than a fifth of the portfolio is small and mid-cap stocks. Nvidia is the largest holding with a 14% allocation and Broadcom (NASDAQ: AVGO), AMD (NASDAQ: AMD), Taiwan Semiconductor Manufacturing (NYSE: TSM)and Texas Instruments (NASDAQ: TXN) complete the first five.

So if you’re looking to buy the subsequent earnings drop in Nvidia, but are bullish on the chipmaking industry as a whole, this could be an ETF to put on your watch list.

Nvidia is not the only megacap to withdraw

While Nvidia has been in the headlines recently as the latest megacap to report earnings, it’s important to realize that it’s not the only “Magnificent Seven” stock to pull back recently. Actually, with S&P 500 near the all-time high, you might be surprised to learn that five of the seven stocks are down more than 10% from their 52-week highs.

Data source: yCharts. Percentages from 29.08.2024.

Now, I’m not saying that these stocks have become “cheap” by any definition. All Magnificent Seven stocks trade for price-to-earnings (P/E) multiples that are well above that of the average S&P 500 company. But they also have tons of upside potential, and if you’re convinced these winners will keep winning, you can invest in all seven cu Roundhill Magnificent Seven ETF (MAG -0.45%).

The ETF offers equal exposure to all seven stocks and comes with a reasonable expense ratio of 0.29%. If you think pullbacks from companies like Alphabet and Amazon.com have been overdone in addition to Nvidia, this ETF might be worth a closer look right now.

Which is best for you?

Both are solid ETFs with reasonable fees, and the best choice for you depends on your investment goals and the groups of stocks you want exposure to. After Nvidia’s latest gains, if you think the recent pullback has gone a little too far and you want to invest but don’t necessarily want to open a large position in Nvidia itself, these two ETFs could be smart choices for your portfolio .