Market Overview

Wonderful Wearables Get Their Own ETF

Wonderful Wearables Get Their Own ETF

The wearable technology trend has been legitimized in the world of exchange-traded funds, as the first ETF dedicated to public companies that make or sell wearable devices debuted Friday. The WEAR ETF (BATS: WEAR) is the rookie wearable technology ETF.

WEAR tracks the Wearables Index, a benchmark developed by EQM Indexes. Exchange Traded Concepts, LLC (ETC) and Eve Capital partnered to launch the new ETF.

What's WEAR?

WEAR's index is designed “to track global companies that have a current or future business focus on wearable technology products and/or components,” according to EQM Indexes. That index “seeks to track the combined performance of a basket of global stocks that derive revenue from the sale of wearable technology devices (electronics that can be worn on the body either as an accessory or as part of clothing) for applications such as: Sports and Fitness, Industrial/Military, Infotainment/Lifestyle, and/or Healthcare and Medical OR derives revenue from the manufacturing of components used in wearable devices such as semiconductors, sensors, and displays.”

Holdings And Allocations

The index is home 54 stocks, 35 of which are US-based companies. WEAR's equal-weight index allocates 37 percent of its weight to large caps, 48 percent to mid caps and the remaining 15 percent to smaller stocks.

Not surprisingly, technology stocks account for over half the index's weight with healthcare being the second-largest sector allocation at 22 percent. Consumer discretionary follows at 19 percent.

Familiar names in WEAR's lineup include Apple Inc. (NASDAQ: AAPL), Fitbit Inc (NYSE: FIT), Garmin Ltd. (NASDAQ: GRMN), Boston Scientific Corporation (NYSE: BSX) and GoPro Inc. (NASDAQ: GPRO).

WEAR charges 0.85 percent per year, or $85 on a $10,000 investment.

“Wearable devices are changing the way people work and play. They are becoming more and more a part of our daily lives," said Bryce Tillery, CEO of Eve Capital, in a statement. "We think this trend will continue far into the future as devices become smaller and faster and new technologies enable more uses for wearable devices.”


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