Designed to provide broad exposure to the Technology - Broad segment of the equity market, the Global X FinTech ETF (FINX) is a passively managed exchange traded fund launched on 09/12/2016.
An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.
Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Technology - Broad is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 3, placing it in top 19%.
The fund is sponsored by Global X Management. It has amassed assets over $303.52 M, making it one of the average sized ETFs attempting to match the performance of the Technology - Broad segment of the equity market. FINX seeks to match the performance of the Indxx Global FinTech Thematic Index before fees and expenses.
The Indxx Global FinTech Thematic Index invests in companies on the leading edge of the emerging financial technology sector, which encompasses a range of innovations helping to transform established industries like insurance, investing, fundraising, and third-party lending through unique mobile and digital solutions.
Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.
Annual operating expenses for this ETF are 0.68%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.09%.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
Looking at individual holdings, Wirecard Ag accounts for about 6.32% of total assets, followed by Temenos Group Ag-Reg and Fiserv Inc.
The top 10 holdings account for about 55.93% of total assets under management.
Performance and Risk
So far this year, FINX has added roughly 22.37%, and it's up approximately 38.55% in the last one year (as of 08/06/2018). During this past 52-week period, the fund has traded between $19.25 and $27.92.
The ETF has a beta of 0.95 and standard deviation of 14.27% for the trailing three-year period. With about 39 holdings, it has more concentrated exposure than peers.
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.