An ETF For Apple Earnings

Markets Benzinga

Apple Inc. (AAPL), the largest U.S. company by market capitalization, steps into the earnings confessional Tuesday after the close of U.S. markets. For the December-ending quarter, analysts expect California-based Apple to revenue of nearly $76.7 billion, up from $74.6 billion a year earlier.

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However, analysts and investors are apt to focus more on Apple's guidance for the March-ending quarter one that many expect will reflect slowing growth. The analysts expect Apple to report $56.1 billion in revenues for the March quarter, compared with the $58.01 billion it reported in the year-ago quarter (down 3.3 percent), reported Fast Company.

Related Link: Apple And Microsoft Earnings: Mac Vs. PC All Over Again?

Nearly 90 exchange-traded funds hold share of Apple, with capitalization-weighted technology sector ETFs usually boasting the largest allocations to the iPad maker. The Fidelity MSCI Information Technology Index ETF (FTEC) is one of those ETFs. In fact, FTEC belongs in the conversation about so-called Apple ETFs due to the fund's 14.2 percent weight to the stock. That is nearly 450 basis points more than FTEC devotes to Microsoft Corporation (MSFT), the ETF's second largest holding.

A Closer Look At FTEC

FTEC debuted in October 2013 as part of Fidelity's 10-ETF lineup of sector funds. With an expense ratio of just 0.12 percent per year, FTEC is the second-least expensive equity-based energy ETF on the market today, and cost-conscious investors can realize additional savings by trading FTEC on Fidelity's platform because the issuer offers a broad swath of ETFs on a commission-free basis. Home to $454.4 million in assets under management, FTEC is one of Fidelity's largest ETFs.

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FTEC can also provide investors with protection and profit potential if and when the Federal Reserve gets around to increasing borrowing costs: Technology. In fact, technology, the largest sector weight in the S&P 500, has historically been of the best-performing sectors during Fed tightening cycles.

Apple's cash reserves were reported to be $203 billion as of late July. At the end of the second quarter, Microsoft, FTEC's second-largest holding at a weight of almost 10.7 percent, had $96.35 billion in cash.

In addition to Apple and Microsoft, FTEC's other top 10 holdings include Google parent Alphabet Inc (GOOGL) (GOOG), Facebook Inc (FB) and Dow component Visa Inc (V).

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