Is First Trust NASDAQ-100-Technology Sector ETF (QTEC) a Strong ETF Right Now?

Core Viewpoint - The First Trust NASDAQ-100-Technology Sector ETF (QTEC) is a smart beta ETF designed to provide broad exposure to the technology sector, with a focus on outperforming traditional market cap weighted indexes [1][5]. Fund Overview - QTEC was launched on April 19, 2006, and is managed by First Trust Advisors, accumulating over $2.67 billion in assets, making it one of the larger ETFs in the technology sector [1][5]. - The fund aims to match the performance of the NASDAQ-100 Technology Sector Index, which is an equal-weighted index based on technology securities from the NASDAQ-100 Index [5]. Cost Structure - QTEC has annual operating expenses of 0.55%, which is competitive within its peer group [6]. Sector Exposure and Holdings - The ETF has a significant allocation in the Information Technology sector, comprising approximately 86.6% of the portfolio, with Telecom and Consumer Discretionary as the next largest sectors [7]. - Datadog, Inc. (class A) (DDOG) is the largest holding at about 2.57% of total assets, with the top 10 holdings accounting for approximately 23.9% of total assets under management [8]. Performance Metrics - Year-to-date, QTEC has returned roughly 12.71%, and it is up approximately 19.06% over the last 12 months as of August 11, 2025 [10]. - The ETF has traded between $149.56 and $218.81 in the past 52 weeks, with a beta of 1.25 and a standard deviation of 28.20% over the trailing three-year period, indicating higher risk compared to peers [10]. Alternatives - Other ETFs in the technology sector include the Technology Select Sector SPDR ETF (XLK) and the Vanguard Information Technology ETF (VGT), which have significantly larger asset bases of $84.79 billion and $99.8 billion, respectively [12]. - XLK has a lower expense ratio of 0.08%, while VGT charges 0.09% [12].