ETF Spotlight: Equal-Weight Nasdaq-100 | ETF Trends

ETF Spotlight on the Direxion NASDAQ-100 Equal Weighted Index Shares (NYSEArca: QQQE), part of an ongoing series.

Assets: $26.4 million

Objective: The Direxion NASDAQ-100 Equal Weighted Index fund tries to reflect the performance of the NASDAQ-100 Equal Weighted Index, which is comprised of the 100 largest non-financial securities listed on the NASDAQ and equally weights its components.

Holdings: Top holdings include Vertex Pharmaceuticals (NasdaqGS: VRTX) 1.4%, Baidu (NasdaqGS: BIDU) 1.0%, DISH Network (NasdaqGS: DISH) 1.0%, Charter Communications (NasdaqGS: CHTR) 1.0% and TripAdvisor (NMS: TRIP) 1.0%.

What You Should Know:

  • Direxion Investments sponsors the fund.
  • QQQE has a 0.35% expense ratio.
  • The ETF has 100 holdings and the top ten components make up 10.6% of the overall portfolio.
  • Sector allocations include basic materials 1.0%, consumer discretionary 18.7%, telecom services 9.0%, industrials 8.8%, tech 42.5%, consumer staples 6.9% and healthcare 13.2%.
  • Market-cap allocations include mega-cap 17.1%, large-cap 46.3% and mid-cap 36.6%.
  • The fund is up 2.3% over the past month, up 8.0% over the last three months and up 9.3% year-to-date.
  • IELG is trading 7.9% above its 200-day exponential moving average.
  • “The NASDAQ-100 Equal Weighted Index allots the same weight, or importance, to each stock in the index,” according to Direxion. “The result is a more diversified performance contribution from the individual companies, and sectors that are in the index.”
  • Specifically, the equal-weight methodology shows a greater tilt toward smaller companies.
  • The underlying index is rebalanced quarterly in March, June, September and December.
  • Potential investor should utilize limit orders to better control trades as the ETF shows a daily average volume of about 5,000.

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