On Tuesday, First Trust Advisors L.P., a leading exchange traded fund provider and asset manager, announced the launch of the First Trust Expanded Technology ETF (NYSE Arca: XPND). The fund seeks to provide long-term capital appreciation by investing at least 80% of its net assets (plus any borrowings for investment purposes) in common stocks of companies identified by the fund’s investment advisor as either information technology companies or consumer discretionary and communication services companies whose operations are principally derived from and/or dependent upon technology (collectively “expanded technology companies”).
“Technological innovation doesn’t follow the constraints of traditional sector classifications,” said Ryan Issakainen, CFA, Senior Vice President and ETF Strategist at First Trust. “We believe XPND will appeal to investment professionals seeking exposure to an expanded universe of technology-driven stocks.”
The fund seeks to capture the growth of technology-related companies without being constrained to the traditional information technology sector designated by the Global Industry Classification Standard (GICS). By expanding sector selection across the information technology, communications services, and consumer discretionary sectors, the fund provides broader access to today’s technology and related industries.
The fund is managed by First Trust Advisors, with selection and portfolio decisions made by a team of portfolio managers. The securities included in the portfolio are chosen using a quantitatively driven approach and leveraging the knowledge of First Trust’s equity research and portfolio management teams, who understand the drivers of risk-adjusted returns.
XPND begins with a large cap universe of U.S. common stocks listed on U.S. exchanges and includes only those companies classified by GICS as belonging to the information technology sector or certain technology-dependent industries within the consumer discretionary and communication services sectors whose
operations are principally derived from and/or dependent upon technology.
In selecting securities for the portfolio, the investment advisor considers a range of quantitative attributes, including, but not limited to, operating metrics and financial metrics, such as return on equity, momentum, and free cash flow growth. The portfolio will consist of approximately 50 companies.
For more information, visit http://www.ftportfolios.com.