Harbor Transformative Technologies ETF lost 8.80% in Q1, trailing its Nasdaq-100 benchmark. The fund cut its Nvidia stake from 12% to 7% and added Meta, Alphabet, and Amazon.
Harbor Transformative Technologies ETF (TEC) lost 8.80% in the first quarter of 2026, underperforming the Nasdaq-100 by a wide margin. The fund's managers responded by slashing their largest position.
Nvidia, which accounted for roughly 12% of the portfolio at the start of the quarter, was cut to about 7% by March 31. The semiconductor giant fell 17% in Q1, a sharper drop than the broader tech index. Harbor's team said in the quarterly commentary that the reduction was "not a view against the company's long-term opportunity," but rather a risk-management step after the stock's 2024–2025 rally pushed its portfolio weight "beyond what we would consider prudent."
The fund added to Meta Platforms, Alphabet, and Amazon.com over the same period, according to the filing. Those three names together now account for roughly 15% of net assets, up from 11% in December. Apple and Microsoft remain the fund's two largest holdings, though both positions were trimmed slightly.
Outside mega-cap tech, the commentary flagged a new position in Reddit and an increased allocation to Amazon-backed Anthropic. The firm described both as early-stage bets on the shift from "retrieval-based search to reasoning-based AI." Small holdings in CrowdStrike and Palantir were sold entirely.
The ETF's turnover rate for the quarter was about 45%, a signal that the manager was actively repositioning rather than riding out the drawdown. The fund ended March with roughly $420 million in assets under management, down from $510 million three months earlier, reflecting both market losses and net redemptions.
TEC's five largest holdings as of March 31: Apple (8.6%), Microsoft (8.1%), Nvidia (7.2%), Amazon (5.4%), and Meta (5.1%). The fund's cash position stood at 3.2% of net assets.
Harbor said it expects the rate-cutting cycle to accelerate in the second half of 2026, which the commentary called a potential tailwind for the fund's heavy tilt toward growth and innovation stocks. No changes to the portfolio's overall structure are planned before the Fed's June meeting, the firm said.
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