Is First Trust NASDAQ Semiconductor ETF (FTXL) a Strong ETF Right Now?

The First Trust NASDAQ Semiconductor ETF (FTXL) made its debut on 09/20/2016, and is a smart beta exchange traded fund that provides broad exposure to the Technology ETFs category of the market.What Are Smart Beta ETFs?Market cap weighted indexes were created to reflect the market, or a specific segment of the market, and the ETF industry has traditionally been dominated by products based on this strategy.Market cap weighted indexes work great for investors who believe in market efficiency. They provide a low-cost, convenient and transparent way of replicating market returns.On the other hand, some investors who believe that it is possible to beat the market by superior stock selection opt to invest in another class of funds that track non-cap weighted strategies--popularly known as smart beta.This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.The smart beta space gives investors many different choices, from equal-weighting, one of the simplest strategies, to more complicated ones like fundamental and volatility/momentum based weighting. However, not all of these methodologies have been able to deliver remarkable returns.Fund Sponsor & IndexFTXL is managed by First Trust Advisors, and this fund has amassed over $1.26 billion, which makes it one of the larger ETFs in the Technology ETFs. This particular fund, before fees and expenses, seeks to match the performance of the Nasdaq US Smart Semiconductor Index.The Nasdaq US Smart Semiconductor Index is a modified factor weighted index, designed to provide exposure to US companies within the semiconductor industry.Cost & Other ExpensesCost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive cousins if all other fundamentals are the same.Annual operating expenses for this ETF are 0.60%, making it on par with most peer products in the space.It has a 12-month trailing dividend yield of 0.34%.Sector Exposure and Top HoldingsMost ETFs are very transparent products, and disclose their holdings on a daily basis. ETFs also offer diversified exposure, which minimizes single stock risk, though it's still important for investors to research a fund's holdings.Representing 100% of the portfolio, the fund has heaviest allocation to the Information Technology sector.Taking into account individual holdings, Micron Technology, Inc. (MU) accounts for about 10.64% of the fund's total assets, followed by Intel Corporation (INTC) and Broadcom Inc. (AVGO).Its top 10 holdings account for approximately 64.32% of FTXL's total assets under management.Performance and RiskYear-to-date, the First Trust NASDAQ Semiconductor ETF has added roughly 40.76% so far, and is up about 41.22% over the last 12 months (as of 11/28/2025). FTXL has traded between $62.37 $128.16 in this past 52-week period. The ETF has a beta of 1.44 and standard deviation of 34.02% for the trailing three-year period. With about 32 holdings, it has more concentrated exposure than peers .AlternativesFirst Trust NASDAQ Semiconductor ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which investors could consider as well.iShares Semiconductor ETF (SOXX) tracks PHLX SOX Semiconductor Sector Index and the VanEck Semiconductor ETF (SMH) tracks MVIS US Listed Semiconductor 25 Index. iShares Semiconductor ETF has $16.48 billion in assets, VanEck Semiconductor ETF has $36.09 billion. SOXX has an expense ratio of 0.34% and SMH changes 0.35%.Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology ETFsBottom LineTo 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.Boost Your Portfolio with Our Top ETF InsightsZacks' exclusive Fund Newsletter delivers actionable information, top news and analysis, as well as top-performing ETFs, straight to your inbox every week.Don’t miss out on this valuable resource. It’s free!Get it now >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report First Trust NASDAQ Semiconductor ETF (FTXL): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks