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5 Popular ETF Investment Themes to Consider in 2022
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Wall Street has witnessed a very rocky start to 2022. The Dow Jones Industrial Average and the S&P 500 indices saw a third consecutive week of decline along with experiencing their worst weekly performances since 2020 (for the week ending Jan 21, 2022). The tech-heavy Nasdaq Composite is also not any lesser in trouble. The index has also witnessed the weakest weekly performance since October 2020, per a CNBC article. It has entered the correction territory as the Nasdaq Composite is now lagging its November record close by more than 14%.
Presently, market participants remain concerned about the uncertainty surrounding the pandemic, the fate of the fourth-quarter earnings season and the Federal Reserve’s decision to hike the interest rates sooner.
Amid the pandemic-related concerns, thematic investing continues to be a popular trend. Against this backdrop, let’s take a look at some of the themes that may trend in the investment world in 2022:
Blockchain
Blockchain came into the limelight as the underlying technology for the most popular cryptocurrency — Bitcoin. An article on Investor’s Business Daily has defined blockchain technology as a shared public ledger, also known as a distributed database, which tracks and records transactions in a transparent and tamper-proof way.
The estimates for the uptake of this technology are mind-boggling. Deutsche Bank expects blockchain systems to record transactions for about 10% of worldwide GDP by 2027.
The world is gradually moving toward digitization, increasing the dominance of technology in the financial sector. A Market Data Forecast (MDF) report also highlights the growing opportunities in the global financial technology market, which is expected to see a CAGR of 23.4% between 2021 and 2026. According to the report, the fintech space is expected to reach a market value of around $324 billion by 2026.
Along with an increased interest in online shopping, customers are resorting to digital payments to clear their bills. At the same time, merchants and utility providers are increasingly advocating the same.
In such a scenario, investors can check out ETFMG Prime Mobile Payments ETF (IPAY - Free Report) , Ecofin Digital Payments Infrastructure Fund and Global X FinTech ETF (FINX) (read: A Comprehensive Guide to Fintech ETFs).
AI, Robotics & Cyber Security ETFs
AI is fast changing the business landscape by expanding opportunities, driving revenues and enhancing efficiencies. It helps enhance almost everything, including advertising, healthcare, robotics, retail, video streaming, gaming and urban development.
We live in an era largely dominated by AI applications and technological advancements. Amid the coronavirus crisis, demand for online services increased, leading to AI's dominance. Globally, the AI market is estimated to see a CAGR of 29%, rising from $42.8 billion in 2019 to $152.9 billion in 2023, according to an Analytics Insight article.
The robotics market is flooded with opportunities as robots are being used for jobs, such as sanitizing hospitals, homes and workplaces along with monitoring, surveying, handling, and delivering food and medicines.
However, the increasing adoption of these technologies is exposing businesses, governments and organizations to cyber risks.
Per a Grand View Research report, the global cybersecurity market is expected to reach $241.1 billion, witnessing a CAGR of 11% from 2019 to 2025. Accordingly, our investors can consider Global X Robotics & Artificial Intelligence ETF (BOTZ - Free Report) , First Trust Nasdaq Artificial Intelligence and Robotics ETF (ROBT - Free Report) , ROBO Global Robotics & Automation ETF (ROBO - Free Report) , iShares Robotics and Artificial Intelligence Multisector ETF (IRBO), First Trust Nasdaq Cybersecurity ETF (CIBR) and ETFMG Prime Cyber Security ETF (HACK) (read: Play 5 High-Beta ETF Areas for January & Be a Bottom Fisher).
Cloud Computing ETFs
Cloud computing and storage are expected to stay in vogue during 2022. The space received quite a push amid the coronavirus outbreak, with a vast population working from home across the globe. Considering the accelerated coronavirus vaccine rollout globally, demand for cloud computing is set to stay robust even after the pandemic dies down.
It is worth noting here that cloud computing and storage found applications in social networking, messaging apps and on streaming services. It empowered video conferencing, gaming, e-commerce shopping, remote project collaboration, online classes, editing, etc. Cloud computing is also supporting organizations in remotely processing a lot of information plus developing and running key applications as well as services.
Thus, investors can consider First Trust Cloud Computing ETF (SKYY - Free Report) , Global X Cloud Computing ETF (CLOU) and WisdomTree Cloud Computing ETF (WCLD) (read: 5 ETF Predictions for 2022).
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5 Popular ETF Investment Themes to Consider in 2022
Wall Street has witnessed a very rocky start to 2022. The Dow Jones Industrial Average and the S&P 500 indices saw a third consecutive week of decline along with experiencing their worst weekly performances since 2020 (for the week ending Jan 21, 2022). The tech-heavy Nasdaq Composite is also not any lesser in trouble. The index has also witnessed the weakest weekly performance since October 2020, per a CNBC article. It has entered the correction territory as the Nasdaq Composite is now lagging its November record close by more than 14%.
Presently, market participants remain concerned about the uncertainty surrounding the pandemic, the fate of the fourth-quarter earnings season and the Federal Reserve’s decision to hike the interest rates sooner.
Amid the pandemic-related concerns, thematic investing continues to be a popular trend. Against this backdrop, let’s take a look at some of the themes that may trend in the investment world in 2022:
Blockchain
Blockchain came into the limelight as the underlying technology for the most popular cryptocurrency — Bitcoin. An article on Investor’s Business Daily has defined blockchain technology as a shared public ledger, also known as a distributed database, which tracks and records transactions in a transparent and tamper-proof way.
The estimates for the uptake of this technology are mind-boggling. Deutsche Bank expects blockchain systems to record transactions for about 10% of worldwide GDP by 2027.
Blockchain ETFs like Amplify Transformational Data Sharing ETF (BLOK - Free Report) may be tracked by investors (read: 4 Stocks & ETFs to Make the Most of Metaverse Boom).
Digital Payment ETFs
The world is gradually moving toward digitization, increasing the dominance of technology in the financial sector. A Market Data Forecast (MDF) report also highlights the growing opportunities in the global financial technology market, which is expected to see a CAGR of 23.4% between 2021 and 2026. According to the report, the fintech space is expected to reach a market value of around $324 billion by 2026.
Along with an increased interest in online shopping, customers are resorting to digital payments to clear their bills. At the same time, merchants and utility providers are increasingly advocating the same.
In such a scenario, investors can check out ETFMG Prime Mobile Payments ETF (IPAY - Free Report) , Ecofin Digital Payments Infrastructure Fund and Global X FinTech ETF (FINX) (read: A Comprehensive Guide to Fintech ETFs).
AI, Robotics & Cyber Security ETFs
AI is fast changing the business landscape by expanding opportunities, driving revenues and enhancing efficiencies. It helps enhance almost everything, including advertising, healthcare, robotics, retail, video streaming, gaming and urban development.
We live in an era largely dominated by AI applications and technological advancements. Amid the coronavirus crisis, demand for online services increased, leading to AI's dominance. Globally, the AI market is estimated to see a CAGR of 29%, rising from $42.8 billion in 2019 to $152.9 billion in 2023, according to an Analytics Insight article.
The robotics market is flooded with opportunities as robots are being used for jobs, such as sanitizing hospitals, homes and workplaces along with monitoring, surveying, handling, and delivering food and medicines.
However, the increasing adoption of these technologies is exposing businesses, governments and organizations to cyber risks.
Per a Grand View Research report, the global cybersecurity market is expected to reach $241.1 billion, witnessing a CAGR of 11% from 2019 to 2025. Accordingly, our investors can consider Global X Robotics & Artificial Intelligence ETF (BOTZ - Free Report) , First Trust Nasdaq Artificial Intelligence and Robotics ETF (ROBT - Free Report) , ROBO Global Robotics & Automation ETF (ROBO - Free Report) , iShares Robotics and Artificial Intelligence Multisector ETF (IRBO), First Trust Nasdaq Cybersecurity ETF (CIBR) and ETFMG Prime Cyber Security ETF (HACK) (read: Play 5 High-Beta ETF Areas for January & Be a Bottom Fisher).
Cloud Computing ETFs
Cloud computing and storage are expected to stay in vogue during 2022. The space received quite a push amid the coronavirus outbreak, with a vast population working from home across the globe. Considering the accelerated coronavirus vaccine rollout globally, demand for cloud computing is set to stay robust even after the pandemic dies down.
It is worth noting here that cloud computing and storage found applications in social networking, messaging apps and on streaming services. It empowered video conferencing, gaming, e-commerce shopping, remote project collaboration, online classes, editing, etc. Cloud computing is also supporting organizations in remotely processing a lot of information plus developing and running key applications as well as services.
Thus, investors can consider First Trust Cloud Computing ETF (SKYY - Free Report) , Global X Cloud Computing ETF (CLOU) and WisdomTree Cloud Computing ETF (WCLD) (read: 5 ETF Predictions for 2022).