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The year 2022 has been tough so far on growth sectors like technology, largely due to the rising rates. The tech-heavy Nasdaq composite Index has already been down 22.2% so far this year. However, the dip in technology sector paved the way to cherry-pick some gems that can reap good returns.
CNBC’s Mad Money show host Jim Cramer recently suggested investors to park their money in the tech stocks. After Target’s latest quarterly earnings results, speculations are rife that inflation might be peaking. This can help the Federal Reserve go easy on the monetary tightening policies. In this regard, Jim Cramer mentioned that “The real greenlight here is on the beaten-down tech. … They might deserve a bit of a resurgence if they have profits and a total romp if they have buybacks and dividends,” as stated in a CNBC article.
Studying the current market conditions, we highlight a few prominent technology areas that are worth buying the dips on expectations of favorable trends:
Investors are paying great attention to cybersecurity stocks as these have been rallying for quite sometime amid the rising panic of cyberattacks. Market experts warned about the possibility of cyberattacks by Russia in retaliation for Western sanctions as part of Kremlin’s war strategy. Also, the increasing adoption of revolutionary technologies is exposing businesses, governments and organizations to cyber risks.
The Global X Cybersecurity ETF seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Indxx Cybersecurity Index. With an AUM of $1.17 billion, BUG charges 50 basis points (bps) in fees.
The cloud computing industry continues to see an increased uptake and growing popularity. It became integral to the digital world as corporations continue to adopt it or update their existing platforms. The shift to digitization is set to remain robust even after the pandemic dies down, keeping companies dependent on cloud-based services to realize that change. In the post-pandemic world, cloud-technology adoption is projected to witness robust growth in sectors where the work-from-home or hybrid working initiatives are helping sustain business functions.
First Trust Cloud Computing ETF seeks investment results that correspond generally to the price and yield, before fees and expenses, of the ISE CTA Cloud Computing Index. SKYY tracks the performance of companies actively involved in the cloud computing industry. The fund holds about 71 securities in its basket. SKYY has an AUM of $3.84 billion and an expense ratio of 0.60% (read: A Detailed Guide to Cloud Computing 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, which led to the dominance of AI.
The iShares Robotics and Artificial Intelligence Multisector ETF seeks to track the investment results of an index composed of developed and emerging market companies that could benefit from the long-term growth and innovation in robotics technologies and artificial intelligence. With an AUM of $271.9 million, IRBO charges 47 bps in fees.
First Trust Dow Jones Internet Index Fund (FDN - Free Report)
The ongoing pandemic and the discovery of new variants are subtle reminders that the Internet dependency might increase with time. The pandemic has been a blessing in disguise to date for the e-commerce industry as people continue practicing social distancing and online shopping for all essentials, especially food items. The space is thriving on expanding digitization and the growing dependency on the Internet owing to recent trends like work from home, digital payments, digitization of healthcare and rising demand for video gaming.
The First Trust Dow Jones Internet Index Fund seeks investment results that correspond generally to the price and yield, before the fund's fees and expenses, of an equity index called the Dow Jones Internet Composite Index. With an AUM of $4.62 billion, FDN charges 51 bps as fees (read: Cisco Tumbles on Sales View Cut: ETFs in Focus).
The semiconductor space is attracting huge inflows in 2022 despite weakness in chipmaker stocks.Notably, the growing adoption of cloud computing and the ongoing infusion of artificial intelligence (AI) and machine learning are brightening the prospects of the semiconductor space in 2022. Moreover, the revolutionary 5G platform is expected to act as a major catalyst for semiconductor revenues in the mobile phone market.
The VanEck Semiconductor ETF seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the MVIS US Listed Semiconductor 25 Index, which is intended to track the overall performance of companies involved in semiconductor production and equipment. With an AUM of $7.85 billion, SMH charges 35 bps in fees (read: 5 ETFs to Buy for June 2022)
Amplify Transformational Data Sharing ETF (BLOK - Free Report)
Blockchain came into the limelight as the underlying technology for the most popular cryptocurrency, which is Bitcoin. An article on Investor’s Business Daily defined blockchain technology as a shared public ledger, also known as a distributed database, which tracks and records transactions transparent and tamper-proof. The estimates for the uptake of this technology are mind-boggling. Deutsche Bank expects blockchain systems to record transactions of about 10% of the worldwide GDP by 2027.
The Amplify Transformational Data Sharing ETF is an actively managed ETF that seeks to provide total return by investing at least 80% of its net assets in equity securities of companies actively involved in the development and utilization of blockchain technologies. With an AUM of $643.3 million, BLOK charges 71 bps as fees.
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6 ETFs From Popular Tech Areas to Consider Now
The year 2022 has been tough so far on growth sectors like technology, largely due to the rising rates. The tech-heavy Nasdaq composite Index has already been down 22.2% so far this year. However, the dip in technology sector paved the way to cherry-pick some gems that can reap good returns.
CNBC’s Mad Money show host Jim Cramer recently suggested investors to park their money in the tech stocks. After Target’s latest quarterly earnings results, speculations are rife that inflation might be peaking. This can help the Federal Reserve go easy on the monetary tightening policies. In this regard, Jim Cramer mentioned that “The real greenlight here is on the beaten-down tech. … They might deserve a bit of a resurgence if they have profits and a total romp if they have buybacks and dividends,” as stated in a CNBC article.
Studying the current market conditions, we highlight a few prominent technology areas that are worth buying the dips on expectations of favorable trends:
Global X Cybersecurity ETF (BUG - Free Report)
Investors are paying great attention to cybersecurity stocks as these have been rallying for quite sometime amid the rising panic of cyberattacks. Market experts warned about the possibility of cyberattacks by Russia in retaliation for Western sanctions as part of Kremlin’s war strategy. Also, the increasing adoption of revolutionary technologies is exposing businesses, governments and organizations to cyber risks.
The Global X Cybersecurity ETF seeks to provide investment results that correspond generally to the price and yield performance, before fees and expenses, of the Indxx Cybersecurity Index. With an AUM of $1.17 billion, BUG charges 50 basis points (bps) in fees.
First Trust Cloud Computing ETF (SKYY - Free Report)
The cloud computing industry continues to see an increased uptake and growing popularity. It became integral to the digital world as corporations continue to adopt it or update their existing platforms. The shift to digitization is set to remain robust even after the pandemic dies down, keeping companies dependent on cloud-based services to realize that change. In the post-pandemic world, cloud-technology adoption is projected to witness robust growth in sectors where the work-from-home or hybrid working initiatives are helping sustain business functions.
First Trust Cloud Computing ETF seeks investment results that correspond generally to the price and yield, before fees and expenses, of the ISE CTA Cloud Computing Index. SKYY tracks the performance of companies actively involved in the cloud computing industry. The fund holds about 71 securities in its basket. SKYY has an AUM of $3.84 billion and an expense ratio of 0.60% (read: A Detailed Guide to Cloud Computing ETFs).
iShares Robotics and Artificial Intelligence Multisector ETF (IRBO - Free Report)
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, which led to the dominance of AI.
The iShares Robotics and Artificial Intelligence Multisector ETF seeks to track the investment results of an index composed of developed and emerging market companies that could benefit from the long-term growth and innovation in robotics technologies and artificial intelligence. With an AUM of $271.9 million, IRBO charges 47 bps in fees.
First Trust Dow Jones Internet Index Fund (FDN - Free Report)
The ongoing pandemic and the discovery of new variants are subtle reminders that the Internet dependency might increase with time. The pandemic has been a blessing in disguise to date for the e-commerce industry as people continue practicing social distancing and online shopping for all essentials, especially food items. The space is thriving on expanding digitization and the growing dependency on the Internet owing to recent trends like work from home, digital payments, digitization of healthcare and rising demand for video gaming.
The First Trust Dow Jones Internet Index Fund seeks investment results that correspond generally to the price and yield, before the fund's fees and expenses, of an equity index called the Dow Jones Internet Composite Index. With an AUM of $4.62 billion, FDN charges 51 bps as fees (read: Cisco Tumbles on Sales View Cut: ETFs in Focus).
VanEck Semiconductor ETF (SMH - Free Report)
The semiconductor space is attracting huge inflows in 2022 despite weakness in chipmaker stocks.Notably, the growing adoption of cloud computing and the ongoing infusion of artificial intelligence (AI) and machine learning are brightening the prospects of the semiconductor space in 2022. Moreover, the revolutionary 5G platform is expected to act as a major catalyst for semiconductor revenues in the mobile phone market.
The VanEck Semiconductor ETF seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the MVIS US Listed Semiconductor 25 Index, which is intended to track the overall performance of companies involved in semiconductor production and equipment. With an AUM of $7.85 billion, SMH charges 35 bps in fees (read: 5 ETFs to Buy for June 2022)
Amplify Transformational Data Sharing ETF (BLOK - Free Report)
Blockchain came into the limelight as the underlying technology for the most popular cryptocurrency, which is Bitcoin. An article on Investor’s Business Daily defined blockchain technology as a shared public ledger, also known as a distributed database, which tracks and records transactions transparent and tamper-proof. The estimates for the uptake of this technology are mind-boggling. Deutsche Bank expects blockchain systems to record transactions of about 10% of the worldwide GDP by 2027.
The Amplify Transformational Data Sharing ETF is an actively managed ETF that seeks to provide total return by investing at least 80% of its net assets in equity securities of companies actively involved in the development and utilization of blockchain technologies. With an AUM of $643.3 million, BLOK charges 71 bps as fees.