Should You Invest in the First Trust NASDAQ-100-Technology Sector ETF (QTEC)?

Launched on April 19, 2006, the First Trust NASDAQ-100-Technology Sector ETF (QTEC) is a passively managed exchange traded fund designed to provide a broad exposure to the Technology - Broad segment of the equity market.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 2, placing it in top 13%.Index DetailsThe fund is sponsored by First Trust Advisors. It has amassed assets over $2.92 billion, making it one of the larger ETFs attempting to match the performance of the Technology - Broad segment of the equity market. QTEC seeks to match the performance of the NASDAQ-100 Technology Sector Index before fees and expenses.The NASDAQ-100 Technology Sector Index is an equal-weighted index based on the securities of the NASDAQ-100 Index that are classified as technology.CostsSince cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.Annual operating expenses for this ETF are 0.55%, making it on par with most peer products in the space.Sector Exposure and Top HoldingsEven though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.This ETF has heaviest allocation in the Information Technology sector -- about 85.5% of the portfolio. Telecom and Consumer Discretionary round out the top three.Looking at individual holdings, Applovin Corp. (class A) (APP) accounts for about 3.63% of total assets, followed by Broadcom Inc. (AVGO) and Shopify Inc. (class A) (SHOP).The top 10 holdings account for about 27.32% of total assets under management.Performance and RiskSo far this year, QTEC return is roughly 23.9%, and is up roughly 23.17% in the last one year (as of 10/06/2025). During this past 52-week period, the fund has traded between $149.56 and $233.92.The ETF has a beta of 1.27 and standard deviation of 27.25% for the trailing three-year period, making it a high risk choice in the space. With about 46 holdings, it has more concentrated exposure than peers.AlternativesFirst Trust NASDAQ-100-Technology Sector ETF holds a Zacks ETF Rank of 2 (Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, QTEC is a great option for investors seeking exposure to the Technology ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.Technology Select Sector SPDR ETF (XLK) tracks Technology Select Sector Index and the Vanguard Information Technology ETF (VGT) tracks MSCI US Investable Market Information Technology 25/50 Index. Technology Select Sector SPDR ETF has $91.12 billion in assets, Vanguard Information Technology ETF has $109.08 billion. XLK has an expense ratio of 0.08%, and VGT charges 0.09%.Bottom 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-100-Technology Sector ETF (QTEC): 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