First Trust Dow Jones Internet Index

This ETF offers exposure to companies that derive at least half of their sales from the Internet, a unique group of stocks that features a heavy tilt towards tech companies with a sprinkling of consumer firms as well. While the idea of exposure to web-based businesses may be appealing, it's important to note that the underlying holdings consist of companies engaged in a wide variety of businesses, and as such are impacted by entirely unique factors. Unlike many ETFs that focus on a specific sector, FDN isn't necessarily backed by a cohesive investment thesis; besides a general dependence on the Internet, the underlying components have little in common. As such, it's unclear exactly how FDN could fit into a portfolio, though it likely has little use for those interested in constructing a long-term portfolio. FDN is reasonably well balanced across about 40 names, though there is a general tilt towards large caps and a few well known tech giants account for a significant portion of holdings. Overall, FDN may be useful for a select few investors with a very specific view of the tech sector or a desire for fine tuned equity exposure, but most will find little use in this fund. Broad-based tech ETFs such as XLK may will be more useful for general tactical overlays, including more component stocks at a much lower fee.