Telecom ETF

AAA

DEFINITION of 'Telecom ETF'

An exchange-traded fund that invests in companies with a significant stake in telephone and internet products, services and technologies. There are many different flavors of telecom ETFs, each of which focuses on a different aspect of the telecommunications industry. International telecom ETFs invest in top telecommunications companies from countries around the world. Telecom services ETFs invest in companies that provide phone and internet service. Other telecom ETFs do not focus on a single aspect of the telecommunications sector but track the sector as a whole.

Also know as "communications industry ETF".

INVESTOPEDIA EXPLAINS 'Telecom ETF'

In one respect, telecom ETFs do not offer investors much in the way of diversification and risk mitigation because they are concentrated on a single industry; on the other hand, they do offer diversification and risk mitigation because they allow investors to invest in a basket of telecommunications companies. As a result, telecom ETFs can be less risky than buying a single company's stock.

RELATED TERMS
  1. Exchange-Traded Fund (ETF)

    A security that tracks an index, a commodity or a basket of assets ...
  2. ISP (Internet Service Provider)

    A company that provides consumers, businesses, and other Internet ...
  3. Communication Industry ETF

    An exchange-traded fund that invests in telecommunications companies ...
  4. Broadband

    A high-speed, high-capacity transmission medium that can carry ...
  5. Federal Communications Commission ...

    An independent U.S. government regulatory agency responsible ...
  6. Asymmetric Digital Subscriber Line ...

    A new technology that provides high transmission speeds for video ...
RELATED FAQS
  1. What are the differences between an MLP exchange traded fund (ETF) and an MLP exchange ...

    The main difference between a master limited partnership (MLP), exchange-traded fund (ETF) and an MLP exchange-traded note ... Read Full Answer >>
  2. Why are simple-interest loans preferred by payday loan companies and pawn shops?

    Investors use corporate bonds for a variety of reasons. These bonds can offer dependable income, safety, diversity, marketability ... Read Full Answer >>
  3. Which sectors have similar pros and cons to the drugs sector?

    In financial terms, the drug sector has a high level of risk and growth. It must gather a lot of up-front investment to drive ... Read Full Answer >>
  4. What is the best ETF for trading mid-cap stocks?

    Mid-cap stocks are those from companies with a market capitalization of between $2 billion and $10 billion. Exchange-traded ... Read Full Answer >>
  5. Which ETFs that track the insurance sector are most popular?

    The most popular ETFs that track the insurance sector are the SPDR S&P Insurance ETF (KIE), iShares US Insurance ETF ... Read Full Answer >>
  6. How can I profit from a decline of stock prices in the insurance sector?

    Some of the methods of profiting from a decline in the insurance sector are shorting insurance stocks, shorting insurance ... Read Full Answer >>
Related Articles
  1. Mutual Funds & ETFs

    4 Ways To Use ETFs In Your Portfolio

    To take full advantage of these vehicles, you need to know how they can fulfill certain strategies.
  2. Personal Finance

    How To Pick The Best Telecom Stocks

    This ever-changing industry can leave investors scratching their heads. Find out which metrics matter.
  3. Mutual Funds & ETFs

    Introduction To Exchange-Traded Funds

    Get into ETFs and enjoy the benefits of a mutual fund with the flexibility of a stock.
  4. Mutual Funds & ETFs

    Top 7 ETFs Designed for Retirement Income

    These seven ETFs offer several advantages over traditional ETFs, especially for investors seeking retirement income.
  5. Mutual Funds & ETFs

    Why You May Want To Be (And Stay) In Bonds

    Bonds are complicated, and it’s easy to feel intimidated or confused. Fortunately, you don’t need to be a numbers geek to be an informed investor.
  6. Chart Advisor

    Commodity Traders are Watching These 3 Charts

    As we head towards the summer months, many commodity traders are looking to diversify their holdings and to protect themselves against inflation.
  7. Chart Advisor

    The Stock Market's Uptrend Is Set To Continue

    The most common debate amongst traders is when the prolonged uptrend across the financial markets will come to an end.
  8. Mutual Funds & ETFs

    How To Short The U.S. Bond Market

    The U.S. bond market has enjoyed a strong bull run over the past few years as the Federal Reserve has lowered interest rates to historic low levels.
  9. Mutual Funds & ETFs

    The EMAG Emerging Mkts Bond ETF: Worth the Risk?

    The Market Vectors Emerging Markets Aggregate Bond ETF (EMAG) might offer long-term rewards, but is now the best time to jump in?
  10. Mutual Funds & ETFs

    5 Dividend ETFs with Growth Potential

    A quick look at a few ETFs with substantial growth potential.

You May Also Like

Hot Definitions
  1. Moving Average - MA

    A widely used indicator in technical analysis that helps smooth out price action by filtering out the “noise” from random ...
  2. Yield Curve

    A line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but differing maturity ...
  3. Productivity

    An economic measure of output per unit of input. Inputs include labor and capital, while output is typically measured in ...
  4. Variance

    The spread between numbers in a data set, measuring Variance is calculated by taking the differences between each number ...
  5. Terminal Value - TV

    The value of a bond at maturity, or of an asset at a specified, future valuation date, taking into account factors such as ...
  6. Rule Of 70

    A way to estimate the number of years it takes for a certain variable to double. The rule of 70 states that in order to estimate ...
Trading Center