ETF Talk: Innovation Makes Life Easier

“Innovation is the ability to see change as an opportunity, not a threat.”

— Steve Jobs

Society is on the brink of several life-changing breakthroughs, from advancements in artificial intelligence to significant medical discoveries. In nearly every sector, new achievements are improving the human experience, and the financial world is no different.

Financial Technology is reshaping the way we do business. Encompassing everything from mobile banking to blockchain artificial intelligence (AI), FinTech prioritizes convenience by harnessing digital tools to improve the user experience.

And what could be more convenient than an exchange-traded fund (ETF) that contains all the most important FinTech stocks in one place? As is characteristic of innovations in FinTech, today’s ETF is user-friendly, streamlined and efficient. It provides ample access to a range of companies in the sector.

Global X FinTech ETF (NASDAQ: FINX) is an ETF that exposes investors to companies on the leading edge of breakthroughs in the emerging financial technology sector.

The fund encompasses a variety of innovations that improve established industries like insurance, investing, lending and banking. Some examples include AI chatbots for 24/7 customer support, peer-to-peer (P2P) fund transfer services and “buy now, pay later” services. Many of these innovations have quickly established themselves as parts of our daily lives, a time without their services already unthinkable.

With the success of these innovations, it’s no wonder that this ETF is succeeding as well.

FINX traded between $28.95 and $34.10 this year. It has 65 holdings.

The fund has net assets of $298.72 billion and a yield of 0.50%. It has an expense ratio of 0.68%. The fund is down 1.35% over the last month, 1.73% in the last three months and up 20.28% for the year to date.

Exclusive ETF Talk: Finding Value in Your Brokerage

The top 10 holdings account for about 56.67% of the portfolio’s assets and include Coinbase (NASDAQ: COIN), 7.84%, SoFi Technologies (NASDAQ: SOFI), 5.69%, Intuit Inc. (NASDAQ: INTU), 5.6%, PayPal Holdings (NASDAQ: PYPL), 4.90%, Fidelity National Information Services (NYSE: FIS), 4.66%, Circle Internet Group (NYSE: CRCL), 4.55%, Block Inc. (NYSE: XYZ), 4.51%, Adyen (ADYEN.AS), 4.43%, Affirm Holdings Inc. (NASDAQ: AFRM), 4.01% and SS&C Technologies (NASDAQ: SSNC), 3.91%.

Chart courtesy of www.Stockcharts.com

The fund is not diversified, meaning all of its holdings are concentrated in one sector: financial technology. However, there are a diverse array of companies in the fund, each contributing to the powerful presence of financial technology in the stock market.

The fintech sector has been rapidly expanding in tandem with the AI revolution, so investing in a fund like FINX could allow investors to realize massive profits as new advancements in the field continue to arise.

However, don’t just take my word for it. Investors should always do their due diligence before adding any stock, fund or ETF to any portfolio.

As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an email. You just may see your question answered in a future ETF Talk.

Jim Woods

Jim Woods is a 20-plus-year veteran of the markets with varied experience as a broker, hedge fund trader, financial writer, author and newsletter editor. Jim is the editor of Forecasts & Strategies, Tactical Trader, TNT Trader, Five Star Trader, Bullseye Stock Trader, and The Deep Woods. His books include co-authoring, “Billion Dollar Green: Profit from the Eco Revolution,” and “The Wealth Shield: How to Invest and Protect Your Money from Another Stock Market Crash, Financial Crisis or Global Economic Collapse.” He’s also ghostwritten many books and articles, as well as edited content for some of the investment industry’s biggest luminaries. His articles have appeared on many leading financial websites, including StockInvestor.com, InvestorPlace.com, Main Street Investor, MarketWatch, Street Authority, Human Events and many others. Jim formerly worked with Investor’s Business Daily founder William J. O’Neil, helping to author training courses in the CANSLIM stock-picking methodology. The independent firm TipRanks rates Jim the No. 3 financial blogger in the world (out of more than 6,000). TipRanks calculates that, since 2012, he's made 361 successful recommendations out of 499 total, earning a success rate of 72% and a +15.3% average return per recommendation. He is known in professional and personal circles as “The Renaissance Man,” because his expertise includes such varied fields as composing and performing music; Western horsemanship, combat marksmanship, martial arts, auto racing and bodybuilding. Jim holds a BA in philosophy from the University of California, Los Angeles, and is a former U.S. Army paratrooper. A self-described “radical for capitalism,” he celebrates the virtue of making money from his Southern California horse ranch.