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IndexFunds.com Staff
New Technology iShare
IndexFunds.com Staff
Tuesday, March 20, 2001
A new iShares exchange-traded fund (ETF) began trading on the American Stock Exchange on Monday. The Goldman Sachs Technology Index Fund (trading symbol: IGM) will track the Goldman Sachs Technology Index, and has an expense ratio of 0.50%.
The index is comprised of over 200 companies in the following industries: producers of computer-related devices, electronics networking and Internet services, producers of computer and Internet software, consultants for information technology and providers of computer services.
Hoping to capitalize on a wave of investor bottom-feeding, Barclays Global Investors (BGI) is launching the new ETF into the teeth of a very bearish tech market. The Dow Jones Technology Index is down over 60% for the year, as of March 21, 2001. The chart below shows the historical performance of the Goldman Sachs Technology Index since inception (8/29/96):
Source: Goldman Sachs
Given their low expense ratios and tax efficiency, ETFs could be a good tool for the contrarian investor to get some exposure to the punch-drunk technology sector. Here's a quick snapshot of what else is out there:
|
Fund Name
|
Ticker
|
Expense Ratio
|
Fund Incept Date
|
Net Assets $MM
|
Tot Ret 1 Mo
|
Tot Ret 3 Mo
|
Tot Ret 12 Mo
|
|
Broadband HOLDRs
|
BDH
|
$0.08/100 shares
|
2000-04
|
327.5
|
-43.96
|
-39.08
|
-
|
|
B2B Internet HOLDRs
|
BHH
|
$0.08/100 shares
|
2000-02
|
353.0
|
-42.83
|
-48.96
|
-87.63
|
|
streetTRACKS Fortune e-50 Index
|
FEF
|
0.20%
|
2000-10
|
23.4
|
-27.46
|
-25.67
|
-
|
|
Internet HOLDRs
|
HHH
|
$0.08/100 shares
|
1999-09
|
359.3
|
-25.89
|
-18.05
|
-73.67
|
|
Internet Architecture HOLDRs
|
IAH
|
$0.08/100 shares
|
2000-02
|
238.3
|
-28.73
|
-28.97
|
-46.25
|
|
iShares Dow Jones US Internet
|
IYV
|
0.60%
|
2000-05
|
26.1
|
-37.27
|
-35.75
|
-
|
|
iShares Dow Jones US Technology
|
IYW
|
0.60%
|
2000-05
|
129.9
|
-29.06
|
-24.10
|
-
|
|
streetTRACKS Morgan Stanley Internet
|
MII
|
0.50%
|
2000-09
|
8.0
|
-31.01
|
-30.45
|
-
|
|
streetTRACKS MorganStanley HighTech
|
MTK
|
0.50%
|
2000-09
|
87.1
|
-23.79
|
-15.55
|
-
|
|
NASDAQ 100 Trust Shares
|
QQQ
|
0.18%
|
1999-03
|
25,775.6
|
-26.36
|
-24.82
|
-55.75
|
|
Semiconductor HOLDRs
|
SMH
|
$0.08/100 shares
|
2000-05
|
322.6
|
-29.08
|
-12.81
|
-
|
|
Technology Select Sector SPDR
|
XLK
|
0.56%
|
1998-12
|
1,238.3
|
-24.91
|
-19.40
|
-49.87
|
|
Software HOLDRs
|
SWH
|
$0.08/100 shares
|
2000-10
|
84.5*
|
-27.22
|
-16.75
|
-16.75
|
Source: Morningstar, all data as of 2/28/01 except * as of 12/31/00
Here's the top ten holdings of tech ETFs and HOLDRs:
| iShares Goldman Sachs Technology Fund |
Technology Select Sector SPDR |
| Company |
Weighting |
Company |
Weighting |
| Cisco Systems |
8.70%
|
Cisco Systems |
9.51%
|
| Microsoft |
7.40%
|
Microsoft |
7.70%
|
| Intel |
6.40%
|
Intel |
6.77%
|
| Oracle |
5.30%
|
Oracle |
5.43%
|
| IBM |
4.90%
|
EMC |
5.29%
|
| EMC |
4.70%
|
IBM |
4.81%
|
| Nortel Networks |
3.10%
|
Sun Microsystems |
4.54%
|
| Sun Microsystems |
2.90%
|
Nortel Networks |
4.36%
|
| Texas Instruments |
2.60%
|
America Online |
3.03%
|
| AOL Time Warner |
2.60%
|
AT&T |
2.68%
|
*as of 12/29/00 *as of 9/30/00[/:Author:]
| streetTRACKS Fortune e-50 Index |
iShares Dow Jones US Internet |
| Company |
Weighting |
Company |
Weighting |
| Microsoft |
9.26%
|
Verisign |
10.46%
|
| Intel |
8.44%
|
America Online |
10.24%
|
| Cisco |
7.95%
|
Yahoo |
8.82%
|
| Oracle |
7.91%
|
BEA Systems |
8.43%
|
| America Online |
6.49%
|
Ariba |
8.30%
|
| JDS Uniphase |
5.18%
|
Exodus Communications |
5.94%
|
| Yahoo |
3.76%
|
I2 Technologies |
5.42%
|
| Sun Microsystems |
3.19%
|
Check Point Software |
5.37%
|
| Broadcom |
|