First Trust Smartphone ETF (FONE): Review Analysis Details for investments & Trading FONE ETF: Options, Futures, Derivatives & Commodity Trading

First Trust Smartphone ETF (FONE): Review Analysis Details for investments & Trading FONE ETF

This article covers details about First Trust Smartphone ETF (FONE), the expert opinion, review, analysis, risks and details of First Trust Smartphone ETF (FONE)
The investment space keeps buzzing around with lots of interesting ideas. With "technology" sector mixed with investment and trading business, the story takes a completely new dimension. We recently heard about Twitter-Based Hedge Fund, where investments were made into the hedge fund based upon the trends detected on twitter tweets. That I consider to be an extreme case of investment :)
However, there is another interesting new launch recently - this time it is from the First Trust and in the field of smartphones. First Trust which is an active player in the ETF segment, has lauched its FONE ETF which will focus on investments in stocks of companies which are in the business of Smartphones technology, manufacturing as well as marketing.

First Trust Smartphone ETF (FONE ETF) - Review Analysis & Details

Here are some basic details about the First Trust Smartphone ETF (FONE ETF)

What is the specific area of investment for First Trust Smartphone ETF (FONE)? First Trust Smartphone FONE ETF
The FONE ETF from First Trust will specifically focus on smartphone companies for investment. This specific sector will include not just the companies which manufacture smartphones, but will also include companies which are in technology research and marketing of smartphones. The investment arena also includes Network access provider companies, companies in software application development and maintenance for phones and hardware component companies.
However, the investment will vary in the following proportions: - 45% to Smartphones (actual phone), 45% to Software apps and hardware components and rest 10% to network providers.
The investment arena is not focussed only on USA, but expands globally. It will cover companies from, say Taiwan, which may be in technical research for smartphones, or in marketing of smartphones. Nokia is another example.

How many companies will constitute the First Trust Smartphone ETF (FONE)
It is expected that there will be investments made in around 74 companies related to smartphone technology and marketing.

Which underlying index willbe tracked by First Trust Smartphone ETF (FONE)
The FONE ETF will track the underlying NASDAQ OMX CEA Smartphone Index

What is the expense ratio for First Trust Smartphone ETF (FONE)?
The expense ratio for First Trust Smartphone ETF (FONE ETF) is 0.7% only.
Rebalancing frequncy for FONE ETF will be on a quarterly basis.

Final Thoughts and investment opinion about First Trust Smartphone ETF (FONE)
It sounds good to invest in fast moving technology sector, but it has its own pitfalls. One should not forget that the faster a technology moves, the sooner it might get redundant by the new innovations. Whether a company is able to keep up the pace with the latest technology is a big question. Take the case of Nokia and RIM (Blackberry). Nokia was the undisputed world leader in the early mobile era, but is now facing stiff competition from other phone manufacturers like Samsung, Sony Ericsson, HTC, etc. Similarly, Blackberry from RIM was the only email phone provider, now every smartphone even from any Chinese manufacturer comes with email facility at the cheapest rate. Competition is stiff, technology is moving at a rapid rate and one never knows which company will take the hit from the new entrants.
So investing in this ETF which offers a mix of smartphone companies, will be worth compared to individual stocks like Apple, Nokia or RIM.
Investments will be rebalanced quarterly, so that should take care of changes. However, I would have personally liked to see rebalancing happening more frequently, as you never know which brand takes a hit at what time
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