The Invesco NASDAQ Internet ETF (
PNQI Quick Quote PNQI - Free Report) was launched on 06/12/2008, and is a passively managed exchange traded fund designed to offer broad exposure to the Technology - Internet 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.
Additionally, sector ETFs offer convenient ways 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 8, placing it in top 50%.
The fund is sponsored by Invesco. It has amassed assets over $545.38 million, making it one of the average sized ETFs attempting to match the performance of the Technology - Internet segment of the equity market. PNQI seeks to match the performance of the NASDAQ Internet Index before fees and expenses.
The Nasdaq CTA Internet Index is a modified market-capitalization weighted index designed to track the performance of the largest & most liquid U.S.-listed companies engaged in internet-related businesses & that are listed on one of the three major U.S. stock exchanges.
Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.
Annual operating expenses for this ETF are 0.60%, making it on par with most peer products in the space.
Sector Exposure and Top Holdings
ETFs offer a diversified exposure and thus minimize single stock risk but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
This ETF has heaviest allocation in the Information Technology sector--about 33.50% of the portfolio. Telecom and Consumer Discretionary round out the top three.
Looking at individual holdings, Alphabet Inc (
GOOG Quick Quote GOOG - Free Report) accounts for about 10.68% of total assets, followed by Amazon.com Inc ( AMZN Quick Quote AMZN - Free Report) and Adobe Inc ( ADBE Quick Quote ADBE - Free Report) .
The top 10 holdings account for about 60.54% of total assets under management.
Performance and Risk
Year-to-date, the Invesco NASDAQ Internet ETF has lost about -36.74% so far, and is down about -41.15% over the last 12 months (as of 05/06/2022). PNQI has traded between $137.03 and $261.31 in this past 52-week period.
The ETF has a beta of 1.15 and standard deviation of 29.82% for the trailing three-year period, making it a high risk choice in the space. With about 81 holdings, it effectively diversifies company-specific risk.
Invesco NASDAQ Internet ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, PNQI is a reasonable option for those seeking exposure to the Technology ETFs area of the market. Investors might also want to consider some other ETF options in the space.
ARK Next Generation Internet ETF (
ARKW Quick Quote ARKW - Free Report) tracks N/A and the First Trust Dow Jones Internet ETF ( FDN Quick Quote FDN - Free Report) tracks Dow Jones Internet Composite Index. ARK Next Generation Internet ETF has $1.75 billion in assets, First Trust Dow Jones Internet ETF has $4.93 billion. ARKW has an expense ratio of 0.83% and FDN charges 0.51%. Bottom Line
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