There are some exchange-traded funds (ETFs) that might be good ideas to think about in July 2021.
Certain ETFs might be able to give exposure to a certain sector, stock exchange or country. They may be able to give exposure to the underlying growth of companies or trends.
Here are two to think about:
Betashares Global Cybersecurity ETF (ASX: HACK)
There are a growing number of cyberattacks and cybercrime around the world. Indeed, there was another attack in the last couple of days according to media reporting. About 200 US businesses have been hit when Kaseya was targeted and then it spread through corporate networks.
According to Statista, the global cybersecurity market is expected to grow from $137.6 billion in 2017 to $248.25 billion in 2023.
This ETF is invested in businesses that are involved in various elements of the digital world. These are the different weightings: systems software (51.4%), IT consulting and other services (15.6%), communications equipment (13.1%), internet services and infrastructure (9.1%), application software (6.8%) and aerospace and defence (4%).
It has a total of 40 holdings. The biggest 10 positions in the portfolio are: Zscaler, Accenture, Okta, Cisco Systems, Cloudflare, Varonis Systems, Splunk, Fortinet and Verisign.
The annual management fee is 0.67%. Including the fees, the net returns have been 19.3% per annum since inception in August 2016. However, past performance is not an indicator of future performance.
Betashares Nasdaq 100 ETF (ASX: NDQ)
Instead of a sector, this ETF is about giving exposure to a particular stock exchange in the US called the NASDAQ.
This ETF, which may be worth considering in July 2021, owns 100 of the largest businesses on the NASDAQ.
Investors may have heard of many of the largest holdings in the portfolio including Apple, Microsoft, Amazon.com, Facebook, Alphabet, Tesla, Nvidia, PayPal and Adobe.
Whilst IT and communication services (which Facebook and Alphabet count as), there are other sectors represented in this portfolio as well with businesses like PepsiCo, Costco, Booking, Intuitive Surgical, Moderna and Mondelez.
Obviously all of the businesses in the portfolio are listed in the US. But the underlying earnings are globally based. Businesses like Alphabet, Facebook, Apple and Microsoft generate earnings from most countries around the world.
Past performance is no guarantee of future performance. But the past returns of this ETF have materially beaten the returns of the ASX. Since inception in May 2015, the Betashares Nasdaq 100 ETF has produced an average return per annum of almost 21%.
There are a couple of points that BetaShares makes about this ETF. The investment gives exposure to many of the businesses that are changing the way we live. It also has a heavy focus on technology, which doesn’t have much of an allocation in the Australian market.