First Trust Indxx NextG UCITS ETF

Issuer: First Trust

Asset Class: Equity

TER: 70bps

Trading Currency: GBX

Pays Income: False

Listing Date: 02 Jul 2015

Ticker: NXTG

ISIN: IE00BWTNM743

This investment vehicle offers targeted exposure to the companies at the forefront of the global expansion of fifth-generation (5G) and future communication networks. It focuses on businesses instrumental in building and servicing the infrastructure for this technological revolution, including those in semiconductor manufacturing, telecommunications equipment, cell tower and data center operations, and network services. By investing in the foundational elements of the next digital era, the fund aims to capture the long-term growth potential driven by the increasing demand for faster and more reliable connectivity. This demand underpins major innovations such as the Internet of Things (IoT), autonomous vehicles, and advanced artificial intelligence, positioning the constituent companies within a key secular growth trend.

The underlying portfolio is constructed based on a specialized index that identifies companies poised to benefit from the 5G and NextG rollout, offering a more concentrated exposure to the communications infrastructure theme than broader technology funds. The portfolio is globally diversified across North America, Europe, and developed Asia, which mitigates single-country risk while ensuring participation in the worldwide deployment of next-generation networks. The fund employs a physical replication strategy, directly holding shares of the constituent companies, which provides transparency and direct ownership of the underlying assets. This approach ensures the investment's performance is closely aligned with that of the key players in the next-gen communications space.

This instrument is suitable for investors seeking to capitalize on the transformative impact of next-generation communication technologies and can serve as a tactical, growth-oriented holding within a diversified portfolio. As the world becomes increasingly data-dependent, the companies responsible for building the digital highways are expected to experience sustained demand for their products and services. The fund is structured as an accumulating vehicle, meaning any dividends from the underlying holdings are reinvested back into the fund, which can enhance the effects of compounding returns over the long term for investors with a growth-focused strategy.