Investing in Internet Companies: Internet Titans ETF

Internet Titans rule everything around us. Wild but true — nearly half the world is now connected to the internet.

If you believe the future will be written in clicks, shares and “you may also likes,” then the Internet Titans ETF may be up your alley.

Life before and after the internet

Once upon a time (ahem, the 1990s), the internet was something that you could only access on your computer screen. Now we can do all of the above from our mobile phones and devices.

The internet is getting bigger as our screens get smaller.

In 2016, there were over 2 trillion Google searches. Netflix allowed 93 million customers to binge watch their favorite shows (and found 46% of users “cheat” on their partners by watching shows ahead of schedule). Researchers found that Amazon is capturing nearly $1 of every $2 Americans spend shopping online.

That’s a lot of shopping, selling, chatting, banking, working, creating, music playlist uploading, learning, and selfie taking and sharing.

Internet Titans: What’s Inside This ETF?

Internet Titans is designed to include only companies whose primary focus is Internet-related. It contains about 40 companies that fall into two categories: Internet commerce and Internet services.

This exchange traded fund (ETF) will give you exposure to many of the internet and digital companies that you use every day. Amazon, Facebook, Netflix, Alphabet (parent company of Google), PayPal, eBay and Twitter are in the mix.

Also represented: Big names in streaming music (Pandora), website domains (GoDaddy), financial technology (TD Ameritrade), travel (TripAdvisor) as well as healthcare, information technology, and telecommunications.

The index is developed, maintained and sponsored by First Trust Dow Jones Internet Index Fund.

What’s the risk?

Stash rates the Internet Titans ETF as a moderate risk investment. Internet companies are subject to certain risks, including changing and evolving technologies, tough competition and prices that go up and down for reasons that often don’t have to do with how well the company is actually performing.

Since the Internet Titans ETF is made up of nearly all internet-related stocks, consider diversifying your portfolio with other non-industry specific ETFs to balance out your risk such as Moderate Mix.

Want to take a deeper dive into this investment? Check out the First Trust Dow Jones Internet Index Fund (FDN) for a closer look at the fund’s expense ratio, dividend yield, and the risk-return profile of the investment.

Top takeaway

If you think the internet is home to brilliant innovations that will change the way we live our lives for the better, check out this ETF. Just be sure to diversify your portfolio with other investments to minimize your risk.

Other investments to check out:

Social Media Mania
Data Defenders

 






Author:
Lindsay Goldwert is Senior Editor at Stash.



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