Meanwhile, the mutual fund industry also boasts a product that combines exposure to a diverse collection of auto related equities. The Fidelity Select Automotive Fund's (FSAVX) portfolio includes many of the same auto manufacturers as CARZ. However, unlike First Trust's new product, this mutual fund option expands its exposure beyond manufacturers to include suppliers. Johnson Controls, Tenneco (TEN) and TRW Automotive Holdings (TRW) can be found listed among the fund's top 10 components.
The auto industry's phoenix-like resurgence has been exciting to watch and now, with the introduction of CARZ, ETF investors have their first chance to gain direct global exposure. It will be important to exercise caution in the opening days of the fund. As CARZ works to establish its place within the ETF industry, investors should continue turn to weathered-auto plays such as XRT, IYK and FSAVX.
Written by Don Dion in Williamstown, Mass.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV