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Should You Invest in the First Trust Natural Gas ETF (FCG)?
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The First Trust Natural Gas ETF (FCG - Free Report) was launched on 05/08/2007, and is a passively managed exchange traded fund designed to offer broad exposure to the Energy - Natural Gas segment of the equity market.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Energy - Natural Gas is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 16, placing it in bottom 0%.
Index Details
The fund is sponsored by First Trust Advisors. It has amassed assets over $334.37 million, making it one of the average sized ETFs attempting to match the performance of the Energy - Natural Gas segment of the equity market. FCG seeks to match the performance of the ISE-REVERE Natural Gas Index before fees and expenses.
The ISE-Revere Natural Gas Index is an equal-weighted index comprised of exchange-listed companies that derive a substantial portion of their revenues from the exploration and production of natural gas.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.57%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 2.87%.
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 Energy sector--about 97.20% of the portfolio.
Looking at individual holdings, Eog Resources, Inc. (EOG - Free Report) accounts for about 4.74% of total assets, followed by Conocophillips (COP - Free Report) and Occidental Petroleum Corporation (OXY - Free Report) .
The top 10 holdings account for about 42.35% of total assets under management.
Performance and Risk
The ETF has lost about -4.82% and is down about -11.20% so far this year and in the past one year (as of 07/23/2025), respectively. FCG has traded between $19.37 and $27.09 during this last 52-week period.
The ETF has a beta of 0.89 and standard deviation of 30.11% for the trailing three-year period, making it a high risk choice in the space. With about 41 holdings, it has more concentrated exposure than peers.
Alternatives
First Trust Natural Gas ETF sports a Zacks ETF Rank of 5 (Strong Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. FCG, then, is not a suitable option for investors seeking exposure to the Energy ETFs segment of the market. However, there are better ETFs in the space to consider.
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Should You Invest in the First Trust Natural Gas ETF (FCG)?
The First Trust Natural Gas ETF (FCG - Free Report) was launched on 05/08/2007, and is a passively managed exchange traded fund designed to offer broad exposure to the Energy - Natural Gas segment of the equity market.
While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.
Investor-friendly, sector ETFs provide many options to gain low risk and diversified exposure to a broad group of companies in particular sectors. Energy - Natural Gas is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 16, placing it in bottom 0%.
Index Details
The fund is sponsored by First Trust Advisors. It has amassed assets over $334.37 million, making it one of the average sized ETFs attempting to match the performance of the Energy - Natural Gas segment of the equity market. FCG seeks to match the performance of the ISE-REVERE Natural Gas Index before fees and expenses.
The ISE-Revere Natural Gas Index is an equal-weighted index comprised of exchange-listed companies that derive a substantial portion of their revenues from the exploration and production of natural gas.
Costs
Expense ratios are an important factor in the return of an ETF and in the long term, cheaper funds can significantly outperform their more expensive counterparts, other things remaining the same.
Annual operating expenses for this ETF are 0.57%, making it on par with most peer products in the space.
It has a 12-month trailing dividend yield of 2.87%.
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 Energy sector--about 97.20% of the portfolio.
Looking at individual holdings, Eog Resources, Inc. (EOG - Free Report) accounts for about 4.74% of total assets, followed by Conocophillips (COP - Free Report) and Occidental Petroleum Corporation (OXY - Free Report) .
The top 10 holdings account for about 42.35% of total assets under management.
Performance and Risk
The ETF has lost about -4.82% and is down about -11.20% so far this year and in the past one year (as of 07/23/2025), respectively. FCG has traded between $19.37 and $27.09 during this last 52-week period.
The ETF has a beta of 0.89 and standard deviation of 30.11% for the trailing three-year period, making it a high risk choice in the space. With about 41 holdings, it has more concentrated exposure than peers.
Alternatives
First Trust Natural Gas ETF sports a Zacks ETF Rank of 5 (Strong Sell), which is based on expected asset class return, expense ratio, and momentum, among other factors. FCG, then, is not a suitable option for investors seeking exposure to the Energy ETFs segment of the market. However, there are better ETFs in the space to consider.