Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Facebook Could Find More ETF Residences

By

Facebook's poor stock performance has hurt its ability to find a home in more ETFs.

PrintPRINT

The slide in shares of Facebook (FB) since the social media firm's May IPO has irked plenty of folks. From investors to California tax collectors, Facebook's slide has been a depressing (and unfortunately) ongoing episode.

The stock's dismal performance has also hampered its ability to find a home in more ETFs. For example, Nasdaq OMX Group (NDAQ) changed some of its rules governing new additions to the prestigious Nasdaq 100 Index prior to Facebook's IPO. In theory, that should have given Facebook an opportunity to slide into the index when it rebalances this month, Index Universe reported.

Facebook's struggles mean it will not be heading into the Nasdaq 100 or the PowerShares QQQ (QQQ), the Nasdaq 100 tracking ETF, at the next rebalance. There is some good news for Facebook, though. Nasdaq OMX announced Monday that the stock will join eight others, including another beaten down social media name, Groupon (GRPN), in joining the Nasdaq Q-50 Index.

The Nasdaq Q-50 Index is not linked to any ETFs, but it is sort of a "minor league" for the Nasdaq 100 because the former is home to the stocks next in line to be added to the latter.

Interestingly, one of the stocks being removed from the Nasdaq Q-50 Index is Sina (SINA), a social media firm commonly referred to as China's answer to Twitter. With a weight of 7.1%, Sina is the third-largest holding in the Global X Social Media Index ETF (SOCL). SOCL is also the only ETF with any noteworthy exposure to Facebook to this point with an allocation of 5.7% to Mark Zuckerberg's company.

Index Universe notes Facebook could join the First Trust Dow Jones Internet Index Fund (FDN) as soon as Friday when that ETF rebalances. The $481.7 million FDN is home to 41 stocks with Google (GOOG) and Amazon (AMZN) combing for almost 19% of the fund's weight.

FDN's primary rival, the PowerShares Nasdaq Internet Portfolio (PNQI), could also become another ETF destination for Facebook. That fund also rebalances quarterly.

Beyond SOCL, Facebook currently has a presence in other ETFs, but the footprint is light. The stock accounts for 0.43% of the iShares Dow Jones US Technology Sector Index Fund (IYW) and 0.13% of the iShares Russell 1000 Growth Index Fund (IWF) as two examples.


Editor's Note: This content was originally published on Benzinga.com by The ETF Professor.

Below, find some more great ETF and market content from Benzinga:

Twitter: @Benzinga

Benzinga Pro covers this and all market news in real time. Get your free trial here.

No positions in stocks mentioned.

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.

PrintPRINT
 
Featured Videos

WHAT'S POPULAR IN THE VILLE