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Why Software ETFs are Soaring

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Technology continues to be one of the best performing sectors this year, up about 17%. Some areas within technology have done much better. Software & services industry is one of them. ETFs tracking the industry are up more than 30% this year.

In 2011, Marc Andreessen, co-founder of the venture capital firm Andreessen-Horowitz, wrote the famous essay--“Why Software Is Eating The World”--which was published in the Wall Street Journal.

“We believe that many of the prominent new Internet companies are building real, high-growth, high-margin, highly defensible businesses.”

 “We are in the middle of a dramatic and broad technological and economic shift in which software companies are poised to take over large swathes of the economy.”

The trend continues to accelerate. Software is still eating the world!

Global corporate spending on software and services is projected to increase by 6.2% in 2018, the highest annual growth rate forecasted since 2007, per IDC.  

According to State Street, “more companies in the software & services industry posted positive earnings surprises and have beat expectations by a larger margin every quarter over the last three years.The industry is expected to continue posting double-digit growth this year and surpass the broader market in 2019.”

To learn  more about the iShares North American Tech-Software ETF (IGV - Free Report) , the Invesco Dynamic Software ETF (PSJ - Free Report) and the SPDR S&P Software & Services ETF (XSW - Free Report) , please watch the short video above.

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