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Should You Invest in the First Trust Water ETF (FIW)?
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If you're interested in broad exposure to the Industrials - Water segment of the U.S. equity market, look no further than the First Trust Water ETF (FIW - Free Report) , a passively managed exchange traded fund launched on 05/08/2007.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also 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. Industrials - Water is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 1, placing it in top 6%.
Index Details
The fund is sponsored by First Trust Advisors. It has amassed assets over $296.30 M, making it one of the average sized ETFs attempting to match the performance of the Industrials - Water segment of the U.S. equity market. FIW seeks to match the performance of the ISE Clean Edge Water Index before fees and expenses.
The ISE Clean Edge Water Index is a modified market capitalization-weighted index comprised of exchange-listed companies that derive a substantial portion of their revenues from the potable and wastewater industry.
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 0.57%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 0.67%.
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 Industrials sector--about 56.10% of the portfolio. Utilities and Healthcare round out the top three.
Looking at individual holdings, Ecolab Inc. (ECL - Free Report) accounts for about 4.36% of total assets, followed by Xylem Inc. (XYL - Free Report) and Idex Corporation (IEX - Free Report) .
The top 10 holdings account for about 40.05% of total assets under management.
Performance and Risk
So far this year, FIW has lost about -1.75%, and is up roughly 12.18% in the last one year (as of 04/28/2018). During this past 52-week period, the fund has traded between $41.39 and $49.96.
The ETF has a beta of 1.10 and standard deviation of 15.46% for the trailing three-year period, making it a medium risk choice in the space. With about 37 holdings, it has more concentrated exposure than peers.
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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Should You Invest in the First Trust Water ETF (FIW)?
If you're interested in broad exposure to the Industrials - Water segment of the U.S. equity market, look no further than the First Trust Water ETF (FIW - Free Report) , a passively managed exchange traded fund launched on 05/08/2007.
Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also 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. Industrials - Water is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 1, placing it in top 6%.
Index Details
The fund is sponsored by First Trust Advisors. It has amassed assets over $296.30 M, making it one of the average sized ETFs attempting to match the performance of the Industrials - Water segment of the U.S. equity market. FIW seeks to match the performance of the ISE Clean Edge Water Index before fees and expenses.
The ISE Clean Edge Water Index is a modified market capitalization-weighted index comprised of exchange-listed companies that derive a substantial portion of their revenues from the potable and wastewater industry.
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 0.57%, making it one of the cheaper products in the space.
It has a 12-month trailing dividend yield of 0.67%.
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 Industrials sector--about 56.10% of the portfolio. Utilities and Healthcare round out the top three.
Looking at individual holdings, Ecolab Inc. (ECL - Free Report) accounts for about 4.36% of total assets, followed by Xylem Inc. (XYL - Free Report) and Idex Corporation (IEX - Free Report) .
The top 10 holdings account for about 40.05% of total assets under management.
Performance and Risk
So far this year, FIW has lost about -1.75%, and is up roughly 12.18% in the last one year (as of 04/28/2018). During this past 52-week period, the fund has traded between $41.39 and $49.96.
The ETF has a beta of 1.10 and standard deviation of 15.46% for the trailing three-year period, making it a medium risk choice in the space. With about 37 holdings, it has more concentrated exposure than peers.
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.