Designed to provide broad exposure to the Technology ETFs category of the market, the First Trust NASDAQ Semiconductor ETF (FTXL Quick QuoteFTXL - Free Report) is a smart beta exchange traded fund launched on 09/20/2016.

What Are Smart Beta ETFs?

The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.

Market cap weighted indexes offer a low-cost, convenient, and transparent way of replicating market returns, and are a good option for investors who believe in market efficiency.

If you're the kind of investor who would rather try and beat the market through good stock selection, then smart beta funds are your best choice; this fund class is known for tracking non-cap weighted strategies.

By attempting to pick stocks that have a better chance of risk-return performance, non-cap weighted indexes are based on certain fundamental characteristics, or a combination of such.

This area offers many different investment choices, such as simplest equal-weighting, fundamental weighting and volatility/momentum based weighting methodologies; however, not all of these strategies can deliver superior results.

Fund Sponsor & Index

The fund is sponsored by First Trust Advisors. It has amassed assets over $1.34 billion, making it one of the larger ETFs in the Technology ETFs. Before fees and expenses, FTXL seeks to match the performance of the Nasdaq US Smart Semiconductor Index.

The Nasdaq US Smart Semiconductor Index is a modified factor weighted index, designed to provide exposure to US companies within the semiconductor industry.

Cost & Other Expenses

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 cousins, other things remaining the same.

With on par with most peer products in the space, this ETF has annual operating expenses of 0.60%.

It has a 12-month trailing dividend yield of 0.11%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. 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.

Taking into account individual holdings, Intel Corporation (INTC) accounts for about 12.14% of the fund's total assets, followed by Micron Technology, Inc. (MU) and Marvell Technology, Inc. (MRVL).

FTXL's top 10 holdings account for about 66.86% of its total assets under management.

Performance and Risk

The ETF return is roughly 68.79% and it's up approximately 129.03% so far this year and in the past one year (as of 08/04/2026), respectively. FTXL has traded between $95.32 and $297.05 during this last 52-week period.

FTXL has a beta of 1.74 and standard deviation of 39.19% for the trailing three-year period. With about 35 holdings, it has more concentrated exposure than peers .

Alternatives

First Trust NASDAQ Semiconductor ETF is an excellent option for investors seeking to outperform the Technology ETFs segment of the market. There are other ETFs in the space which 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 $45.49 billion in assets, VanEck Semiconductor ETF has $68.57 billion. SOXX has an expense ratio of 0.34% and SMH changes 0.35%.

Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Technology ETFs

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.