A number of ETFs with heavy weightings in Apple or Samsung are
sure to be affected when the maker of the iPhone's month-long
patent infringement suit against the South Korean tech giant wraps
up. Deliberations began on Wednesday and a verdict could come
Friday.
Apple is seeking over $2.5 billion in damages from Samsung,
charging that Samsung took three months to rip off features of the
iPhone that took years to develop, according to a report in the
Wall Street Journal. Samsung attorneys are meanwhile arguing that
Apple is using courts to avoid competing in the marketplace, the
Journal said.
That said, Samsung itself is seeking $22.8 million for another
set of patents and a maximum of $399 million in royalties for
patents related to high-speed data technologies, the Journal said.
The stakes are very high indeed, as Samsung is now the world's No.
1 maker of smartphones and is Apple's top rival in the market for
tablets such as the iPad.
So, Apple's and Samsung's stocks hang in the balance, as do ETFs
that own them. At the top of that list is the $34.4 billion
PowerShares QQQ Trust (NasdaqGM:QQQ) and the $2.6 billion iShares
MSCI South Korea Index Fund (NYSEArca:EWY), both of which are
heavily invested in the tech giants. QQQ has 18.8 percent of its
holdings in Apple, and 23 percent of EWY's portfolio is in
Samsung.
The case, being held in federal court in San Jose, Calif., a
major city in the heart of Silicon Valley, has drawn significant
media attention. That's partly because San Jose is so close to
Apple's headquarters in Cupertino, Calif., but also because the
case could have far-reaching implications.
Apart from the two tech giants, a number of well-known companies
in the world of tech-such as Microsoft, Google and Nokia-are
entangled in their own web of patent battles regarding mobile
devices.
Funds besides EWY with heavy weightings in Samsung include:
- iShares MSCI All-Country Asia Information Technology Index
Fund (NYSEArca:AAIT), with 17.6 percent in the Korean
company
- iShares S&P Asia 50 Index Fund (NYSEArca:AIA), which
holds a 15.8 percent in Samsung
Funds beside QQQ with heavy weightings in Apple include:
- iShares Dow Jones U.S. Technology (NYSEArca:IYW), 23.7
percent
- Technology Select Sector SPDR ETF (NYSEArca:XLK), 19
percent
- iShares Morningstar Large Growth Index Fund (NYSEArca:JKE),
15.5 percent
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