NEXTDC Ltd (ASX:NXT) and this ASX tech share could be great options in the rapidly growing sector…
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Are you looking to add some exposure to the tech sector to your portfolio? Given the strong long term growth potential of the sector, this might be well worth considering.
But which tech shares should you buy? Here are two that could be great additions to a balanced portfolio:
BetaShares Asia Technology Tigers ETF (ASX: ASIA)
The first tech share to look at is actually an exchange traded fund (ETF) that gives you exposure to a group of 50 of the best tech shares in the Asia market.
BetaShares notes that this ETF provides diversified exposure to a high-growth sector that is under-represented in the Australian share market.
Among the 50 companies included in the fund, you will find industry giants such as Alibaba, Baidu, JD.com, and Tencent Holdings. The latter is the company behind the hugely popular WeChat app, which has over 1.2 billion active users. It also became a substantial shareholder of local payments giant Afterpay Ltd (ASX: APT) last year.
Over the last 12 months, the BetaShares Asia Technology Tigers ETF generated a return of 73% for investors.
NEXTDC Ltd (ASX: NXT)
Another tech share to look at is NEXTDC. It is a leading data centre-as-a-service provider with a growing network of data centres in key locations across Australia.
NEXTDC has been a very strong performer over the last 12 months thanks to the pandemic accelerating the shift to the cloud. This has led to a significant increase in demand for capacity in its data centres and underpinned strong sales and operating profit growth.
It also meant that management had to bring forward its capacity expansion plans in order to cope with demand.
The good news is that the shift to the cloud still has a long way to go and should support solid growth in the Australian market for some time to come. In addition to this, the company has recently opened up offices in Tokyo and Singapore with a view of expanding into these markets in the near future.
Analysts at Morgans are very positive on its prospects. Late last month its analysts put an add rating and $13.89 price target on its shares.
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Motley Fool contributor James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia owns shares of and has recommended BetaShares Asia Technology Tigers ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.