Fintech & Blockchain ETF (FTEC) – Global X ETFs Australia

FTEC


Fintech & Blockchain ETF

Reasons to Consider FTEC

High Growth Potential

In 2020, the number of active online banking users was approaching 1.9bn worldwide. Forecasts suggest that number could reach 2.5bn by 2024, highlighting the vast reach in just one segment of this theme,1 and the global bitcoin market is expected to surpass USD$5.4bn by 2030.2

Global Tailwinds

Fintech and blockchain are global themes, poised to benefit as both expanding broadband and mobile internet penetration coincide with a rising middle class in developing markets, historically under-served by traditional financial services, and government and industry seek to improve the accuracy, transparency, and security of financial transactions.

Changing Consumer Preferences

While Fintech companies have historically catered to the digital preferences of younger consumers, they are increasingly competing on cost and convenience across a range of more established industries like lending and insurance. 58 countries now offer bitcoin ATMs.3

1 Statista, Mar 2021
2 MarketWatch, Oct 2021
3 Statista, Aug 2021

Product Information As of 22 Feb 2024

Inception Date 13 Oct 2021
Management Costs (% p.a.) 0.69
Currency Hedged No
Domicile Australia
Legal Form Managed Investment Trust
SMSF Eligible Yes

NAV Information As of 22 Feb 2024

NAV/Unit (A$) 9.13120000
Currency (NAV) AUD
Shares Outstanding 740,161
AUM (A$) 6,758,561.45
NAV History File View

Product Summary

The Global X Fintech & Blockchain ETF (FTEC) seeks to invest in companies on the leading edge of the emerging financial technology sector, which encompasses a range of innovations helping to transform established industries like insurance, investing, fundraising, and third-party lending through unique mobile and digital solutions. This theme also includes those positioned to benefit from the increased adoption of blockchain technology, including companies in digital asset mining, blockchain & digital asset transactions, blockchain applications, blockchain & digital asset hardware, and blockchain & digital asset integration.

Product Objective

The Global X Fintech & Blockchain ETF (FTEC) seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Indxx Developed Markets Fintech & DeFi Index.

Trading Details

Ticker FTEC
Bloomberg Code FTEC AU Equity
ISIN AU0000171472
Trading Hours 10:00AM – 4:00PM

Management & Administration

Issuer Global X Management (AUS) Limited
Custodian The Hongkong and Shanghai Banking Corporation Limited, Sydney Branch
Registrar Computershare Investor Services Pty Limited

Benchmark Information

Benchmark Indxx Developed Markets Fintech and DeFi Index
Provider Indxx, LLC.
Ticker IFINDEFN

Distributions As of 31 Jan 2024

12-Month Yield 0.05%
12-Month Franking Level 0.00%
Distribution Frequency Semi-Annually
Distribution History View

Performance Table As of 22 Feb 2024

Total Return (Fund) Total Return (Benchmark) Tracking Difference Tracking Error
1 Month 4.55% 4.66% -0.11% 0.18%
3 Months 18.05% 18.28% -0.24% 0.55%
1 Year 38.35% 40.20% -1.85% 1.04%
3 Year p.a. -- -- -- --
5 Year p.a. -- -- -- --
10 Year p.a. -- -- -- --
Since Inception p.a. -3.75% -2.71% -1.04% 1.59%

Top Holdings As of 23 Feb 2024

Net Assets (%) Name SEDOL Market Price (Local) Shares Held Market Value (A$)
1.91 INTERACTIVE BROK B1WT4X2 106.76 793 129,352
1.87 JAPAN EXCHANGE G 6743882 3,896.00 3,200 126,563
1.83 ADYEN NV BZ1HM42 1,466.20 51 123,509
1.77 CBIZ INC 2730781 74.80 1,049 119,886
1.71 GALAXY DIGITAL H BD5H1G9 12.65 8,065 115,461
1.69 TRADEWEB MARKE-A BJXMVK2 104.60 716 114,429
1.69 ASSETMARK FINANC BKF9D68 33.26 2,243 113,983
1.68 TOAST INC-A BP6D7B7 20.88 3,563 113,668
1.66 FISERV INC 2342034 150.11 489 112,152
1.65 INTERCONTINENTAL BFSSDS9 139.29 524 111,517
1.65 TRANSUNION BYMWL86 76.04 958 111,301
1.64 WOLTERS KLUWER 5671519 146.95 458 111,166
1.64 MASTERCARD INC-A B121557 471.56 154 110,955
1.63 FAIR ISAAC CORP 2330299 1,288.26 56 110,225
1.63 THOMSON REUTERS BNBXPB4 158.13 456 110,172
1.63 GUIDEWIRE SOFTWA B7JYSG3 118.35 609 110,122
1.61 EQUIFAX INC 2319146 265.18 269 108,989
1.61 VISA INC-CLASS A B2PZN04 283.75 251 108,818
1.61 PAGSEGURO DIGI-A BFWK4R7 12.97 5,488 108,754
1.61 WESTERN UNION B1F76F9 12.95 5,483 108,487
1.58 NORDNET AB PUBL BNDLH43 184.70 3,916 106,919
1.58 EXPERIAN PLC B19NLV4 34.36 1,613 106,887
1.58 FIDELITY NATIONA 2769796 64.10 1,091 106,850
1.58 SS&C TECHNOLOGIE B58YSC6 64.54 1,080 106,498
1.57 JACK HENRY 2469193 173.64 399 105,855
1.56 INTUIT INC 2459020 657.92 105 105,549
1.55 XERO LTD B8P4LP4 116.65 873 101,835
1.54 GLOBAL PAYMENTS 2712013 132.45 515 104,220
1.53 HUB24 LTD BD4T5X1 36.98 2,746 101,547
1.51 MSCI INC B2972D2 565.47 118 101,949
1.51 GARTNER INC 2372763 453.46 147 101,847
1.50 CME GROUP INC 2965839 218.00 305 101,589
1.50 COINBASE GLOBA-A BMC9P69 170.91 388 101,319
1.49 H&R BLOCK INC 2105505 47.89 1,376 100,682
1.49 DEUTSCHE BOERSE 7021963 188.00 324 100,610
1.49 S&P GLOBAL INC BYV2325 435.22 151 100,410
1.48 NASDAQ INC 2965107 56.56 1,161 100,330
1.48 HUATAI SECURIT-H BWVFT00 9.66 53,136 100,257
1.47 FLEETCOR TECHNOL B4R28B3 275.83 235 99,038
1.46 MARATHON DIGITAL BLR7B52 24.56 2,629 98,653
1.46 MOODY'S CORP 2252058 381.90 169 98,611
1.45 ENVESTNET INC B474ZK7 48.89 1,310 97,855
1.44 MORNINGSTAR INC B081VR8 276.58 231 97,616
1.44 FACTSET RESEARCH 2329770 458.87 139 97,453
1.42 WISE PLC - A BL9YR75 8.50 5,850 95,943
1.41 HKEX 6267359 254.00 1,927 95,602
1.41 AVANZA BANK HOLD BJXMLF7 223.20 2,882 95,090
1.41 XP INC - CLASS A BK4Y052 24.76 2,513 95,068
1.40 LONDON STOCK EX B0SWJX3 88.44 556 94,833
1.40 VERTEX INC - A BMX6DM1 25.17 2,464 94,758
1.39 PAYPAL HOLDINGS BYW36M8 58.35 1,050 93,610
1.38 RIOT PLATFORMS I BD9F675 15.73 3,889 93,467
1.38 NEXI SPA BJ1F880 7.01 8,044 93,085
1.37 DLOCAL LTD BKVF490 16.31 3,712 92,502
1.36 STONECO LTD-A BGKG6M3 16.50 3,651 92,042
1.36 LUFAX HOLDIN-ADR BR0V7R7 2.65 22,619 91,580
1.34 NUVEI CORP-SUB V BMFNHJ5 32.33 2,479 90,703
1.34 LENDINGCLUB CORP BK95GR4 7.96 7,453 90,643
1.33 DUN & BRADSTREET BLF9ZT2 10.68 5,520 90,074
1.33 GMO PAYMENT GATE B06CMQ9 8,855.00 1,000 89,893
1.31 EDENRED B62G1B5 49.76 1,080 88,765
1.30 BLOCK INC BYNZGK1 67.96 847 87,948
1.25 SOFI TECHNOLOGIE BM8J4C2 8.16 6,757 84,243
1.15 AFFIRM HOLDINGS BMF9NM8 37.33 1,359 77,512
1.09 BILL HOLDINGS IN BKDS4H5 61.69 785 73,990
1.07 WORLDLINE BNFWR44 11.56 3,778 72,105
0.80 UPSTART HOLDINGS BL53QN5 24.47 1,443 53,950
Holdings are subject to change.

Sector Breakdown As of 23 Feb 2024

Sector Weight (%)
Financials 71.0
Information Technology 14.7
Industrials 12.8
Consumer Discretionary 1.5

Country Breakdown As of 23 Feb 2024

Country Weight (%)
United States 64.6
Brazil 4.4
Netherlands 3.5
Japan 3.2
Sweden 3.0
Canada 3.0
China 2.8
Britain 2.8
France 2.4
Ireland 1.6
New Zealand 1.6
Other/Cash 7.1

Research

FAQs

  • What is “fintech”?

    Fintech is a combination of the words finance and technology. Fintech companies are those bringing cutting-edge technology to the financial services industry, and in the process ruffling the feathers of incumbent banks, insurers and wealth managers. Fintech adoption is surging thanks to the world going cashless, which has been a boom for digital payments and point of sale companies. By the adoption of smartphones, which has rocketed digital wallets. By the growth of big data and cloud, which has led to a surge in research providers and financial software companies and by nascent blockchain technology, which if used to its potential could disrupt much of financial services.
  • What is “decentralised finance”?

    Decentralised finance, sometimes referred to as “blockchain”, is distributed ledger technology. Most media coverage of this exciting new area has focused on bitcoin and other cryptocurrencies. However, there is more to blockchain than just cryptos. Promising blockchain innovations include “tokenisation”, which could allow private assets, such as real estate and cars, to trade in tokenised form in a similar way to shares in companies. Another potentially interesting area is “smart contracts”. This is where the terms of an agreement between companies are automatically executed by a blockchain, without the need for lawyers.
  • How are the companies in the index identified?

    Indxx starts by looking at companies within developed markets that meet minimum size and liquidity requirements. Indxx then hones in on several “sub-themes”, which they – and Global X – believe are relevant to fintech and decentralised finance. These sub-themes are decentralised finance, digital payments, financial data provider and analyser, financial enterprise solutions, peer-to-peer lending, personal finance software, tax compliance software, trading and capital markets, and point-of-sale. Within these sub-themes, companies are assessed based on revenue purity. Those making more than 50% of their revenue from these sub-themes are eligible for index inclusion. Companies eligible are selected based on market capitalisation, with each sub-theme capped at providing 10 companies except for decentralised finance which is capped at 20.
  • How are companies in FTEC weighted?

    FTEC uses an equal weight methodology, which is where an equal value of each company included in the index is bought at rebalance. Assuming no market movements, this would mean that each of the 75 companies included in the index would receive 1.33% of the fund’s weight at each rebalance. Equal weighting may have the advantage of allowing investors to “spread their bets” across a diverse range of companies in a fast-changing industry more equally. However, equal weighting has risks. These include potentially higher volatility as it lowers the median market capitalisation of a portfolio compared with market weighted approaches.
  • Why use FTEC for exposure to fintech?

    Fintech and blockchain are rapidly evolving industries. Afterpay was founded in 2014, yet as of August 2021, it has become one of Australia’s largest companies by market capitalisation. Picking individual companies that are likely to win from any theme is very difficult. But picking winners in new areas like fintech can be harder still due to the speed at which things can change. A strength of FTEC is that it offers diversification, providing investors with a basket of 75 researched stocks that capture the fintech theme. The result is that FTEC’s portfolio is likely to be less volatile than picking individual stocks. FTEC also provides a way to access global companies in a single trade. While some fintech companies – like Afterpay and Xero – trade on Australian exchanges, most global companies do not. This spares investors the work and cost of buying a portfolio of companies on foreign exchanges. As FTEC is locally domiciled, there is also less paperwork for end investors. Investors will not be required to complete W8 BEN forms.
  • How can you use FTEC in a portfolio?

    1. To express long-term strategic or short-term tactical views on disruptive financial technology.
    2. To complement financial services sector exposure with tech-aligned companies outside of the GICS classification (the industry sector classification created by MSCI and S&P Dow Jones Indices).
    3. To aid portfolio diversification via investment in companies that are largely absent from the Australian market.
  • Does FTEC overlap with other Global X funds?

    We design our ETFs with a view of minimising the amount of overlap between each. In this way, investors who buy more than one of our funds avoid buying the same stocks repeatedly. The precise amount of overlap between each fund can differ as the stocks moving in and out of each ETF change at index rebalance/reconstitution. Whatever overlap exists is usually small. For investors wanting to know the exact quantity of overlap between specific ETFs, please feel free to contact us.
  • Where can I buy and sell FTEC?

    When it launched, FTEC was listed on the CBOE exchange, the alternative exchange to the ASX. This means that if your broker is not connected to CBOE, then you will be unable to buy and sell FTEC. Most share trading platforms (such as CommSec, Open Markets, Wealthhub and more) are connected to the CBOE exchange and can facilitate your trade. If the platform you use is not connected with CBOE or you are having difficulties locating FTEC online, then we suggest contacting their trade and support team to enquire what is the best possible way to trade FTEC.

Global X Management (AUS) Limited (“Global X”) (Australian Financial Services Licence Number 466778, ACN 150 433 828) is the product issuer. Offers of interests in any retail product will only be made in, or accompanied by, a Product Disclosure Statement (PDS). In respect of each retail product, Global X has prepared a target market determination (TMD). Each PDS and TMD is available at www.globalxetfs.com.au. The information on this website is general in nature only and does not take into account your personal objectives, financial situations or needs. Before acting on any information, you should consider the appropriateness of the information having regard to your objectives, financial situation or needs and consider seeking independent financial, legal, tax and other relevant advice having regard to your particular circumstances. Any investment decision should only be made after obtaining and considering the relevant PDS and TMD. Investments in any product issued by Global X are subject to investment risk, including possible delays in repayment and loss of income and principal invested. The value or return of an investment will fluctuate and an investor may lose some or all of their investment. Past performance is not a reliable indicator of future performance.

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