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Cloud Computing ETF (SKYY) Hits New 52-Week High

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For investors seeking momentum, First Trust Cloud Computing ETF (SKYY - Free Report) is probably on radar. The fund just hit a 52-week high and is up 60.4% from its 52-week low price of $45.00/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea on where it might be headed:

SKYY in Focus

This fund offers exposure to companies actively involved in the cloud computing industry. It has key holdings in software and IT services at 78% while communications & networking, computers, phones & household electronics as well as diversified retail round off the next three spots. The ETF charges 60 bps in annual fees (see: all the Technology ETFs here).

Why the Move?

The cloud-computing corner of the broad stock market has been an area to watch lately, given rising demand. The area has grown exponentially buoyed by stay-at-home orders that have boosted demand for work and entertainment from home. Now, even with the economy reopening, the trend is continuing given the change in consumer behavior. Cloud computing has encouraged video conferencing, gaming, e-commerce, remote project collaboration, online classes and other programs.

More Gains Ahead?

Currently, SKYY has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook, suggesting continued outperformance in the months ahead. Further, many of the segments that make up this ETF have a strong Zacks Industry Rank. So, there is definitely some promise for those who want to ride this surging ETF a little further.

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