The Facebook ETF Factor

Top 10 Holders of FB

Although the new Communication Services sector has the most exposure, it doesn’t breach the top ten in terms of ownership influence. Additionally, the Technology Sector SPDR (XLK) has the 6th most influence on FB and will divest shares later this year when the sector transition is complete.

Passive Stock picking with Active Research

Now that we have covered the FB factor on ETFs that have exposure, let’s evaluate an ETF that sold FB before the recent downturn.

The American Customer Satisfaction Investable Index (ACSI) utilizes proprietary customer satisfaction scores to weight stocks within each sector by their relative customer satisfaction scores. The index utilizes customer satisfaction metrics for over 350 brands, representing over 150 large capitalization securities for inclusion in the index.

The ACSI ETF exited a 2.8% FB position in July, due to deterioration in customer opinions on both the Facebook and Instagram brands. This is a great example of an innovation in using the ETF structure to democratize access to data that has historically been only available to hedge funds.

This article was written by the team at Toroso Asset Management, a participant in the ETF Strategist Channel.

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