Looking for broad exposure to the Technology - Internet segment of the equity market? You should consider the First Trust Dow Jones Internet ETF (FDN), a passively managed exchange traded fund launched on June 19, 2006.
Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Technology - Internet is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 2, placing it in top 13%.
Index Details
The fund is sponsored by First Trust Advisors. It has amassed assets over $5.18 billion, making it one of the larger ETFs attempting to match the performance of the Technology - Internet segment of the equity market. FDN seeks to match the performance of the Dow Jones Internet Composite Index before fees and expenses.
The Dow Jones Internet Composite Index includes only companies whose primary focus is Internet-related.
Costs
Since 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 0.49%, making it on par with most peer products in the space.
Sector Exposure and Top Holdings
Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. 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 40.9% of the portfolio. Telecom and Consumer Discretionary round out the top three.
Looking at individual holdings, Amazon.com, Inc. (AMZN) accounts for about 10.21% of total assets, followed by Netflix, Inc. (NFLX) and Meta Platforms, Inc. (class A) (META).The top 10 holdings account for about 61.6% of total assets under management.
Performance and Risk
So far this year, FDN has lost about 0.66%, and it's up approximately 5.6% in the last one year (as of 05/20/2026). During this past 52-week period, the fund has traded between $226.1 and $287.34.
The ETF has a beta of 1.21 and standard deviation of 21.33% for the trailing three-year period, making it a high risk choice in the space. With about 42 holdings, it has more concentrated exposure than peers.
Alternatives
First Trust Dow Jones Internet 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, FDN 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.
ALPS (OGIG) tracks OSHARES GLOBAL INTERNET GIANTS INDEX and the Invesco NASDAQ Internet ETF (PNQI) tracks NASDAQ Internet Index. ALPS has $107.81 million in assets, Invesco NASDAQ Internet ETF has $543.33 million. OGIG has an expense ratio of 0.48%, and PNQI charges 0.6%.
Bottom Line
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.
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First Trust Dow Jones Internet ETF (FDN): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).