Recently, I compared the compensation of News Corp. (NASDAQ: NWSA ) CEO Rupert
Murdoch with that of Philipe Dauman, the highly paid Viacom (NYSE: VIAB )
executive. My conclusion was that even though Viacoms financial performance has
been far superior to News Corp.s, its return to shareholders has not. In fact,
neither stocks been very good. Nonetheless, investors continue to maintain a
fondness for media stocks despite evidence that there are better places to put
your money. For those who cant break free of media, we provide some ETF
alternatives. That way, youll get your media fix and a little diversification to
boot. If you want both companies included in the top 10 holdings of these ETFs,
your selection isnt very wide. Youd have a much easier time in the mutual fund
arena, but thats a discussion for another day. Exactly five ETFs have News Corp.
as a top 10 holding, and only three have Viacom. As I said, its slim pickings.
Well start with News Corp. By weighting, the PowerShares Dynamic Media Portfolio
(NYSEARCA: PBS ) has the largest representation, at 5.13% of total net assets.
Three positions down, at a weighting of 4.90%, is Viacoms Class B shares. This
is the only ETF available where both stocks are in the top 10 holdings. If you
require none to be in the top 10, your range of choice grows exponentially, but
that somewhat defeats the purpose of this exercise, so lets take a closer look
at PowerShares Dynamic Media. The portfolio has net assets of $117.2 million
that are invested in 30 stocks, including News Corp. and Viacom. As ETFs go, its
relatively costly, with a net expense ratio of 0.63% annually. Although both
companies are part of the services sector, PowerShares considers 75% of the fund
invested in consumer discretionary stocks and 25% in information technology.
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