Should You Invest in the First Trust NASDAQ Clean Edge Smart Grid Infrastructure ETF (GRID)?

Designed to provide broad exposure to the Utilities - Infrastructure segment of the equity market, the First Trust NASDAQ Clean Edge Smart Grid Infrastructure ETF (GRID) is a passively managed exchange traded fund launched on 11/16/2009.Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Utilities - Infrastructure is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 5, placing it in top 31%.Index DetailsThe fund is sponsored by First Trust Advisors. It has amassed assets over $2.07 billion, making it one of the larger ETFs attempting to match the performance of the Utilities - Infrastructure segment of the equity market. GRID seeks to match the performance of the NASDAQ OMX Clean Edge Smart Grid Infrastructure Index before fees and expenses.The Nasdaq Clean Edge Smart Grid Infrastructure Index tracks the performance of common stocks in the grid and electric energy infrastructure sector.CostsSince cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.Annual operating expenses for this ETF are 0.57%, making it one of the more expensive products in the space.It has a 12-month trailing dividend yield of 1.05%.Sector Exposure and Top HoldingsEven though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.Looking at individual holdings, Schneider Electric Se (SU.FP) accounts for about 8.16% of total assets, followed by Abb Ltd (ABBN.SW) and National Grid Plc (NG/.LN).The top 10 holdings account for about 55.99% of total assets under management.Performance and RiskSo far this year, GRID has added about 1.31%, and was up about 20.36% in the last one year (as of 01/16/2025). During this past 52-week period, the fund has traded between $98.77 and $128.54.The ETF has a beta of 1.24 and standard deviation of 21.06% for the trailing three-year period, making it a high risk choice in the space. With about 109 holdings, it effectively diversifies company-specific risk.AlternativesFirst Trust NASDAQ Clean Edge Smart Grid Infrastructure ETF holds a Zacks ETF Rank of 1 (Strong Buy), which is based on expected asset class return, expense ratio, and momentum, among other factors. Because of this, GRID is an outstanding option for investors seeking exposure to the Utilities/Infrastructure ETFs segment of the market. There are other additional ETFs in the space that investors could consider as well.IShares Global Infrastructure ETF (IGF) tracks S&P Global Infrastructure Index and the Global X U.S. Infrastructure Development ETF (PAVE) tracks INDXX U.S. Infrastructure Development Index. IShares Global Infrastructure ETF has $5.07 billion in assets, Global X U.S. Infrastructure Development ETF has $8.73 billion. IGF has an expense ratio of 0.42% and PAVE charges 0.47%.Bottom LineTo learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.Want key ETF info delivered straight to your inbox?Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.Get it free >>Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report First Trust NASDAQ Clean Edge Smart Grid Infrastructure ETF (GRID): ETF Research Reports iShares Global Infrastructure ETF (IGF): ETF Research Reports Global X U.S. Infrastructure Development ETF (PAVE): ETF Research ReportsTo read this article on Zacks.com click here.Zacks Investment ResearchWeiter zum vollständigen Artikel bei Zacks Weiter zum vollständigen Artikel bei Zacks