Core Viewpoint - Wall Street analysts are optimistic about technology and materials stocks, forecasting a 21% upside for information technology and 18% for materials over the next year as of December 5 [1] Group 1: Technology Sector - The Vanguard Information Technology ETF tracks 314 U.S. companies, primarily in semiconductors, software, and electronics hardware, with an expense ratio of 0.09% [4] - The information technology sector trades at 28.6 times forward earnings, above its five-year average of 27.2 and ten-year average of 24.7, but is justified by a projected 26% earnings increase next year [4] - Over the last decade, the information technology sector outperformed the broader market, returning 2,000% compared to the S&P 500's 700% [5] - The sector is expected to continue outperforming the S&P 500 over the next five years, driven by advancements in artificial intelligence [6] - Philippe Laffont predicts technology stocks will grow to represent 75% of the S&P 500, up from less than 40% today, due to the AI boom [7] - The top holdings in the Vanguard Information Technology ETF include Nvidia (18.1%), Apple (14.2%), and Microsoft (12.9%), which together account for about 45% of the ETF's performance [8][9] Group 2: Materials Sector - The Vanguard Materials ETF measures 108 U.S. companies in the materials sector, with a focus on specialty chemicals, industrial glass, and construction materials, also with an expense ratio of 0.09% [10] - The materials sector trades at 18.8 times forward earnings, above its five-year average of 18.1 and ten-year average of 17.6, with a consensus earnings growth forecast of only 5% for 2026 [10] - Historically, the materials sector has underperformed the S&P 500, returning 360% over the last two decades compared to the S&P 500's 700% [11] - The top holdings in the Vanguard Materials ETF include Linde (15%), Newmont (6.8%), and Sherwin-Williams (6.2%) [13]