Following Facebook's (NASDAQ:FB) much ballyhooed new product announcement, shares of the social media giant are off about three percent on volume that is nearly double the daily average and hovering near the lows of the day.
That glum performance is arguably the result of Facebook's newly unveiled "Graph Search" product being perceived as a potential Internet search competitor to Google (NASDAQ:GOOG). Facebook founder Mark Zuckerberg has long wanted to be involved in the Internet search business, but being involved in the business and being a legitimate threat to Google are entirely two different matters.
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While "Graph Search," appears to have some nifty features, such as allowing users to search friends' Timelines, without having to go to each of their Timeline pages to find out if they like a specific place or thing, as ABC News reports, investors might be saying they are skeptical of Facebook challenging Google for search supremacy.
The lack of investor enthusiasm for "Graph Search," is not only weighing on shares of Facebook, but also on some of the ETFs that hold the stock.
For example, the Global X Social Media Index ETF (NYSE:SOCL), the first ETF to include Facebook in its lineup is off 0.72 percent today. That loss is not too shabby when considering a little discussed fact about SOCL. The recent rally in Facebook shares has carried the stock to the top of SOCL's holdings. Facebook is now that ETF's largest holding with a weight of 14.72 percent, up from being the ETF's fifth-largest holding at weight of 6.2 percent in late October.
Shares of the First Trust Dow Jones Internet Index Fund (NYSE:FDN) are also lower on the day. With a weight of 3.83 percent, Facebook is FDN's seventh-largest holding. FDN is home to $680.1 million in assets under management, making it the largest ETF by that metric to feature a remotely significant stake in Facebook.
To be fair, Facebook is not the primary reason FDN is in the red today. Google, Amazon (NASDAQ:AMZN), eBay (NASDAQ:EBAY) and Priceline (NASDAQ:PCLN) are all in the red and those stocks combine for nearly 30 percent of FDN's weight.
Perhaps surprisingly, the First Trust US IPO Index Fund (NYSE:FPX) is trading modestly higher on volume that is more than double the daily average. At a weight of almost 10.7 percent, Facebook is FPX's largest holding. FPX's next largest holding is General Motors (NYSE:GM) with an allocation of 8.23 percent.
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