3 ETFs Set to Buy Twitter
For investors who don't want to invest directly in the company, these three ETFs are set to add Twitter to their portfolios within the next five days.
Investors that do not want to take the risk of investing in a single company such as Twitter will have another option for owning the social media stock this week. At least a couple of ETFs are set to add TWTR to their portfolio in the next five days, creating a new avenue for investors to own a piece of the company:
Global X Social Media ETF (NASDAQ:SOCL). This ETF already has big positions in social media peers FB and LinkedIn (NYSE:LNKD) and the next to join the list will be TWTR. The ETF will wait five days from the day Twitter went public, putting the ETF in position later this week to add the newly traded company. The exact timing and size of the position will be revealed after the stock is purchased.
FB and LNKD each make up 9.5 percent of the portfolio, trailing only Asian peer Tencent Holdings (OTCMKTS:TCTZF). It would not be a surprise to see TWTR land in the top 10 holdings by the end of the week.
Renaissance IPO ETF (NYSEARCA:IPO). This newly launched ETF will also wait five trading days to add TWTR, opening up the potential to add the stock later this week. It focuses on the 50 largest and most liquid US IPOs. The current top holding is FB, with a 10 percent allocation, followed by drug maker Zoetis (NYSE:ZTS). The stocks can remain in IPO for up to two years after going public, likely creating Twitter as a top holding until November 2015.
First Trust IPOX 100 Index ETF (NYSEARCA:FPX). The original IPO ETF could add TWTR after it''s been trading for seven days. But, if history is an indication as to when FPX will add TWTR, it may not be for a couple months. The ETF held off on adding FB after the first week of trading, and it opted to add the stock a few months after it went public. The move looks like genius now because FB eventually fell below its IPO price before rallying to new highs in the last month.
All three ETFs will offer investors exposure to Twitter, but the more important factor in deciding which one to buy comes down to the rest of the holdings. SOCL will concentrate solely on social media with international exposure. IPO will be one of the first ETFs to buy TWTR -- but could it be too early? And FPX will likely wait to add TWTR, which could be the best move based on history. Unfortunately choosing the best of the group cannot be debated in 140 characters or less.
Report: Google Glass Will Save Businesses $1 Billion Annually
Surprise! The iPad Mini is Now On Sale
Johnson & Johnson, Amazon at Odds Over 3rd Party Sales
Benzinga Pro covers this and all market news in real time. Get your free trial here.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.
Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
Daily Recap Newsletter