Social Media ETFs as TikTok Turns Off and On
Gregory S. Davis | January 20, 2025
Reviewed by etfready.com staff
TikTok went dark! Then it returned.
On January 18th 170 million United States based users were without TikTok as the app went dark following the January 17th decision by the U.S. Supreme Court. The U.S. Supreme Court held that the challenged provisions of the Protecting Americans from Foreign Adversary Controlled Applications Act do not violate TikTok’s First Amendment rights. By January 19th, the date by which TikTok had to divest itself from its parent company ByteDance to avoid going dark, TikTok was back on!
For investor who may be thinking which social media providers are potential benefactors of a TikTok shutdown, reboot or just an upswing in social media growth the following three social media focused ETFs may be worthy of consideration. Listed below from largest to smallest by assets under management are the Global X Social Media ETF (SOCL), the VanEck Social Sentiment ETF (BUZZ) and the Fidelity Metaverse ETF (FMET).
ETFReady.com SOCL vs BUZZ vs FMET as of January 17, 2025
How are SOCL, BUZZ and FMET different?
Assets Under Management
The Global X Social Media ETF (SOCL) is the largest in terms of assets with $113.8 M. In contrast the VanEck Social Sentiment ETF (BUZZ) and the Fidelity Metaverse ETF (FMET) both are less than half the size of SOCL with $57.8 M and $31.6 M in assets respectively.
Note: The smaller the amount of assets the greater the possibility of an ETF being shut down by the service provider.
Top Holdings
SOCL is also the most concentrated of the three ETFs with 47 holdings led by META Platforms, Tencent Holdings, a Chinese multinational tech company that provides online services and digital content through its platforms including WeChat and QQ, and NAVER. Corp, a South Korean Internet Conglomerate. The BUZZ ETFs top holdings include Trump Media & Tech, Sofi Technologies and MicroStrategy. FMET ETF top holdings differ with its top holdings being Alphabet A (Parent Company of Google), Apple Inc and Cash.
Expense Ratio
VanEck Social Sentiment ETF (BUZZ) has the highest expense ratio of the three at 0.75% followed by Global X Social Media ETF (SOCL) with 0.65% and Fidelity Metaverse ETF (FMET) with 0.40%.
ETFReady.com SOCL vs BUZZ vs FMET by Sector as of January 17, 2025
How are SOCL, BUZZ and FMET similar?
SOCL, BUZZ and FMET each are trading near their 52-week high. Communication Services comprise the top three sectors represented in each ETF, but to a varying degree. SOCL is the closest of the three to a pure play on Communication Services.
Can I choose based on the P/E Ratio?
Instead of trying to label one ETF as the best, perhaps investors should consider which ETF is best for them based on the P/E Ratio. The P/E Ratio communicates how much investors are willing to pay for $1 of earnings. A higher P/E Ratio suggests higher expected future earnings and therefore a higher expected rate of return. In contracts a lower P/E Ratio suggests undervalued stocks with less expected growth potential.
Here, given BUZZ’s PE Ratio of 35.89 versus FMET’s PE Ratio of 28.17 and SOCL’s PE Ratio of 22.78 the BUZZ ETF appears to have the highest expectation of grow while the SOCL ETF may be comprised of the most undervalued stocks. Keep in mind that no single ratio tells the whole story.
Conclusion: Consider the fit into your overall portfolio.
If the goal for your portfolio is to gain exposure to global social media platforms like Meta Platforms, Tencent Holdings Ltd and NAVER Corp then you may prefer the SOCL ETF.
If you are looking to focus more on information technology with a side of social media exposure, then the BUZZ ETF and the FMET ETF may be right for you. Before deciding take the time to look under the hood of the ETFs you are considering and consider how they fit into your existing holdings.