Credit: Shutterstock photoWith cybercrime on the rise at a global level, and citizens more concerned than ever about identity theft, PureFunds has a unique new security-focused ETF that could see huge growth in coming years.
Earlier this year, a pest control business owner said to me:
Living in Florida, I knew he was making a big claim. Gated communities are everywhere you look!
So what was his rationale for cutting his opportunity set short?
He doesn’t want to hand his driver’s license over to the security guard at the gate.
He’s terrified of having his identity stolen.
It’s not just small business owners who are afraid of a cyber attack …
The world’s largest companies are spending big dollars to protect themselves.
And with good reason.
Here are some of the world’s biggest data breaches over the last couple years and the aftermath …
Why Could Now Be a Good Time to Invest?
You can buy the ETF 20% cheaper than just over a year ago. For comparison purposes, the Russell 2000 Index has fallen about 5% since June 2015.
In the last several weeks, venture capital has taken notice. BitSight raised $40 million, Claroty raised $32 million and StackPath raised $150 million (all cyber security startups).
Performance is picking up in cyber security-related names.
Take HACK’s performance in the last few months …
Source: Bloomberg
As you can see above, where the broader market has flat-lined, HACK has continued to appreciate in the last couple months. The blue region shows the accumulated alpha HACK investors have enjoyed over this short period.
Just since June 28, HACK’s return has more than tripled the S&P 500’s return.
Growth is projected to at least double in six years. The global cyber security industry was $75 billion in 2015. Looking out to 2021, not one estimate has the industry below $150 billion.
And last, as Chanin said, cyber security is a must-have for any publicly traded company in existence today. Just one data breach could put a company out of business. Having no cyber security plan in place is like having no flood insurance while living on the Mississippi River.
If you agree that cyber security will continue to be an ongoing commitment for governments, corporations and individuals world-wide, HACK is a way to profit from ongoing — and increasing — cyber security demand.
HACK can serve as a viable satellite position in any portfolio (individual investor, financial adviser or institution).
This ETF follows the ISE Cyber Security Index (a rules-based cyber security index) … has $785 million in assets … trades about 300,000 shares per day … charges an expense ratio of 0.75% … rebalances quarterly … and contains 35 holdings for ample diversification. HACK could potentially double your money by 2020.
This article originally appeared on Uncommon Wisdom Daily.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
