ETFs Suffering from Facebook (SOCL, IPO, FPX, PNQI, FB)

Shares of Facebook FB traded higher after their earnings report beat the analysts’ expectations for revenue and earnings. On the surface the earnings appears to be positive and investors pushed the price of the shares to the best level in two weeks before the tides began to turn. Throughout the session the stock began to fade and turned negative by the early afternoon.

ETFs Falling

The weakness in shares of FB has spread to other social media stocks and the Global X Social Media ETF SOCL was getting hit harder than shares of FB. The top holding in SOCL, making up 13 percent, is FB. But it was its peers that were underperforming with LinkedIn LNKD and Zynga ZNGA leading the way lower. The ETF is now down nearly 20 percent from the high set in March.

The First Trust U.S. IPO Index ETF FPX has a 9.2 percent weighting in FB and the stock is the largest holding in the portfolio. Even though the only true technology stock in the top ten holdings of the ETF is FB, it has not been able to avoid the selling. The ETF is down 6 percent from its March high even though it has been trying to rally over the last week.

Another IPO ETF that that FB making up 9 percent of its portfolio is the Renaissance IPO ETF IPO. Due to the ETF’s heavier exposure to the technology stocks the performance was lagged that of FPX. The ETF is down 9 percent from the March peak.

A tech-heavy ETF that is down 14 percent since March and has an 8 percent stake in FB is the PowerShares NASDAQ Internet ETF PNQI. The stock is the fourth largest holding and joins other tech giants in the portfolio. The selling in FB and its peers has had a direct affect on PNQI.