After markets closed on Wednesday, Apple trounced expectations by reporting a 15% jump in its second-quarter earnings from a year earlier. That had to come as particularly good news for investors in the PowerShares QQQ (Nasdaq: QQQQ).

Why? Because due to the QQQ's unusual weighting methodology, Apple accounts for 12.6% of the fund's assets. For comparison, Microsoft makes up only 4.8% of the ETF, despite having a significantly larger market cap than Apple: $166 billion vs. $108 billion.

The market-cap oddities don't end there. Google counts for just 4.7% of the fund, despite having a market cap of $120 billion, almost identical to Apple. And Google's weight is just a shade above Gilead Sciences, a biotech company that accounts for 3.5% of the fund, despite having one-third of the market-cap of Google.

Confused?

The oddities trace back to the Nasdaq-100's methodology. The index is officially a "modified market-cap-weighted index." New companies entering the index are weighted essentially based on their market cap. But once they're in the index,

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ETF sector leadership continues to shift rapidly.  The most dramatic move of the week came from a semiconductor ETF, which moved from #37 to #5 in the ratings from our TCA-ETF model.  We try to look at both Trend and Cycle, while doing some Anticipation of key swings.  Ideally, we exit positions when new ETF's gain strength, surpassing current holdings.  Over the last few weeks there have been several dramatic changes of sector leadership.  (For new readers, there is a further explanation of our approach at the end of the article.) The sector moves are also a path to deeper understanding of the overall market.  As usual, we shall start with some fundamental factors that underly semiconductor strength. S&P North American Technology-Semiconductors Index Fund (IGW) This week's featured sector is the iShares S&P North American Technology-Semiconductors Index Fund (IGW).  ...