If you're interested in broad exposure to the Technology - Semiconductors segment of the equity market, look no further than the First Trust NASDAQ Semiconductor ETF (FTXL), a passively managed exchange traded fund launched on September 20, 2016.
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 - Semiconductors 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 $2.22 billion, making it one of the larger ETFs attempting to match the performance of the Technology - Semiconductors segment of the equity market. FTXL seeks to match the performance of the Nasdaq US Smart Semiconductor Index before fees and expenses.
The Nasdaq US Smart Semiconductor Index is a modified factor weighted index, designed to provide exposure to US companies within the semiconductor industry.
Costs
When considering an ETF's total return, expense ratios are an important factor, and cheaper funds can significantly outperform their more expensive counterparts in the long term if all other factors remain equal.
Annual operating expenses for this ETF are 0.6%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 0.11%.
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 100% of the portfolio.
Looking at individual holdings, Intel Corporation (INTC) accounts for about 11.88% of total assets, followed by Micron Technology, Inc. (MU) and Marvell Technology, Inc. (MRVL).The top 10 holdings account for about 66.04% of total assets under management.
Performance and Risk
So far this year, FTXL has added roughly 76.35%, and was up about 130.42% in the last one year (as of 07/21/2026). During this past 52-week period, the fund has traded between $95.32 and $297.05.
The ETF has a beta of 1.71 and standard deviation of 38.43% for the trailing three-year period. With about 35 holdings, it has more concentrated exposure than peers.
Alternatives
First Trust NASDAQ Semiconductor ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, FTXL is an outstanding 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.
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 $44.14 billion in assets, VanEck Semiconductor ETF has $67.38 billion. SOXX has an expense ratio of 0.34%, and SMH charges 0.35%.
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 NASDAQ Semiconductor ETF (FTXL): ETF Research Reports
This article originally published on Zacks Investment Research (zacks.com).