What this ETF is trying to do

The First Trust NASDAQ Semiconductor ETF (FTXL) focuses on the semiconductor industry. This means it invests in companies that make the computer chips used in many different types of technology. According to the provided data, the fund holds 35 different companies.

Top Holdings:

• Intel Corp (11.45%)

• Micron Technology Inc (11.26%)

• Broadcom Inc (6.96%)

• Marvell Technology Inc (6.95%)

• Nvidia Corp (6.56%)

• Advanced Micro Devices Inc (6.33%)

• Qualcomm Inc (6.11%)

• Applied Materials Inc (3.77%)

• Lam Research Corp (3.56%)

• Texas Instruments Inc (3.54%)

Please note that this is only a partial list of the holdings, and company weights can change over time.

What the numbers show

The data shows significant growth in the share price over different periods. The current price is $231.26.

When looking at the past year, we can use an estimated price from roughly one year ago, which was approximately $98.14. This helps us see how much the price has moved.

• One-Year Price Return: This measures only the change in the share price, which was approximately 135.64%.

• One-Year Total Return: This reflects the overall return including distributions, which was approximately 136.07%.

• Year-to-Date (YTD) Price Return: The share price has increased by approximately 78.53% so far this year.

• YTD Total Return: The total return for the year to date is approximately 78.57%.

• Three-Year Price Return: Over three years, the share price grew by approximately 237.36%.

• Three-Year Total Return: The three-year total return was approximately 241.69%.

Income and distribution explanation

This ETF provides cash distributions to investors. The distribution yield is approximately 0.11%. Over the last 12 months, there were 4 payouts, which usually happen on a quarterly basis. Most of these payments occurred on a Thursday.

It is important to remember that a distribution yield is not the same as a total return. While distributions provide cash, they do not guarantee that your original investment will stay the same value.

NAV erosion explanation

"NAV erosion" is a term used to describe when the value of the underlying assets in an ETF drops significantly. If a share price falls from a very high level to a much lower level, it can destroy the principal (the original money put in).

For this ETF, the erosion-risk score is 100, and the label indicates "No price erosion detected." There is no severe erosion-risk flag for this fund.

Pros

• The ETF has shown very high price returns over the last one, two, and three-year periods.

• The total return data shows that the overall performance includes both price growth and distributions.

Cons

• The distribution yield is relatively low (approximately 0.11%), which may not meet the needs of investors looking for high levels of regular cash income.

Beginner takeaway

When looking at ETFs, it is helpful to distinguish between "price return" (how much the share price moved) and "total return" (the price movement plus any cash distributions). For this ETF, both figures have been very high recently. While high yields can be attractive, investors often look for funds where the share price stays steady or grows, rather than funds that experience a sharp decline in price.