Cybersecurity is widely considered to be the future because of several reasons. Why would you invest in the best cybersecurity ETFs?
- Increasing reliance on technology: With the rapid digitization of every industry, people and organizations are relying more and more on technology to store, access and share information. As a result, the number of cyber threats has increased significantly, leading to a greater need for cybersecurity.
- Growing cyber threats: Cyber threats are becoming more sophisticated and frequent, with cybercriminals using advanced tools and techniques to exploit vulnerabilities in computer systems and networks. As the threat landscape evolves, the need for cybersecurity measures is becoming more critical.
- Greater awareness of cybersecurity: With more high-profile cyber attacks making headlines, people and organizations are becoming more aware of the need for cybersecurity. They understand that investing in cybersecurity measures is essential to protect their sensitive data and ensure business continuity.
- Increasing regulatory requirements: Governments and regulatory bodies around the world are introducing stricter laws and regulations to ensure the protection of data privacy and security. Organizations that fail to comply with these requirements face severe penalties, including fines and reputational damage.
Given these factors, it is clear that cybersecurity will continue to be essential in the future. As technology advances, the need for stronger cybersecurity measures will only grow, and organizations that invest in cybersecurity will be better equipped to handle the challenges of the future. What are the best cybersecurity ETFs? Here are the top 10 best cybersecurity ETFs (Exchange-Traded Funds) based on assets under management (AUM) and performance.
1. First Trust NASDAQ Cybersecurity ETF (CIBR)
The First Trust NASDAQ Cybersecurity ETF (CIBR) is an exchange-traded fund that seeks to track the performance of the NASDAQ CTA Cybersecurity Index. The index is comprised of companies that are primarily engaged in providing cybersecurity solutions and services, including network security, endpoint security, application security, and data security.
As of March 18, 2023, CIBR holds 43 stocks from the cybersecurity industry, with the largest holdings including companies such as Palo Alto Networks, Cisco Systems, CrowdStrike Holdings, and Okta Inc. The fund has an expense ratio of 0.60% and is rebalanced quarterly.
CIBR provides investors with exposure to the growing cybersecurity industry, which is expected to continue to experience significant growth due to increasing cyber threats and the growing importance of data protection. The ETF offers investors a diversified portfolio of cybersecurity companies, reducing the risk associated with investing in a single stock.
2. ETFMG Prime Cyber Security ETF (HACK)
The ETFMG Prime Cyber Security ETF (HACK) is an exchange-traded fund that seeks to track the performance of the Prime Cyber Defense Index. The index is comprised of companies that are involved in the cybersecurity industry, including network security, antivirus software, and cybersecurity consulting.
As of March 18, 2023, HACK holds 67 stocks from the cybersecurity industry, with the largest holdings including companies such as CrowdStrike Holdings, Palo Alto Networks, Zscaler, and Okta Inc. The fund has an expense ratio of 0.60% and is rebalanced semi-annually.
In terms of performance, HACK has performed well since its inception in 2014. From its inception through September 2021, the fund had an average annual return of approximately 18.23%.
3. iShares Cybersecurity and Tech ETF (IHAK)
The iShares Cybersecurity and Tech ETF (IHAK) is an exchange-traded fund that seeks to track the performance of the NYSE FactSet Global Cyber Security Index. The index is comprised of companies that are involved in the cybersecurity industry, including companies that offer cybersecurity hardware, software, and services.
As of March 18, 2023, IHAK holds 37 stocks from the cybersecurity industry, with the largest holdings including companies such as CrowdStrike Holdings, Zscaler, Okta Inc., and Fortinet Inc. The fund has an expense ratio of 0.47%.
In terms of performance, IHAK has performed well since its inception in June 2019. From June 2019 through March 2023, the fund had an average annual return of approximately 27.88%. However, it’s important to note that past performance is not indicative of future results and that investing in any ETF involves risk. Additionally, investors should conduct their own research and consult with a financial advisor before making any investment decisions.
4. Global X Cybersecurity ETF (BUG)
The Global X Cybersecurity ETF (BUG) is an exchange-traded fund that seeks to track the performance of the Indxx Cybersecurity Index. The index is comprised of companies that are involved in the cybersecurity industry, including companies that offer cybersecurity hardware, software, and services.
As of March 18, 2023, BUG holds 32 stocks from the cybersecurity industry, with the largest holdings including companies such as Palo Alto Networks, Zscaler, Fortinet Inc., and Crowdstrike Holdings. The fund has an expense ratio of 0.50%.
BUG provides investors with exposure to the growing cybersecurity industry, which is expected to continue to experience significant growth due to increasing cyber threats and the growing importance of data protection. The ETF offers investors a diversified portfolio of cybersecurity companies, reducing the risk associated with investing in a single stock.
In terms of performance, BUG has performed well since its inception in October 2019. From October 2019 through March 2023, the fund had an average annual return of approximately 21.31%.
5. Invesco S&P 500® Cybersecurity ETF (PSJ)
The Invesco S&P 500® Cybersecurity ETF (PSJ) is an exchange-traded fund that seeks to track the performance of the S&P 500® Capped Information Technology Sector Index, which includes companies that are involved in the cybersecurity industry.
As of March 18, 2023, PSJ holds 43 stocks from the cybersecurity industry, with the largest holdings including companies such as Okta Inc., Crowdstrike Holdings, Zscaler, and Palo Alto Networks. The fund has an expense ratio of 0.60%.
PSJ provides investors with exposure to the growing cybersecurity industry, as well as broader exposure to the information technology sector of the S&P 500®. The ETF offers investors a diversified portfolio of cybersecurity companies and other information technology companies, reducing the risk associated with investing in a single stock.
In terms of performance, PSJ has performed well since its inception in November 2015. From November 2015 through March 2023, the fund had an average annual return of approximately 25.73%. However, it’s important to note that past performance is not indicative of future results and that investing in any ETF involves risk. Additionally, investors should conduct their own research and consult with a financial advisor before making any investment decisions.
6. WisdomTree Cybersecurity ETF (WCBR)
The WisdomTree Cybersecurity ETF (WCBR) is an exchange-traded fund that seeks to track the performance of the WisdomTree Team8 Cybersecurity Index. The index is comprised of companies that are involved in the cybersecurity industry, including companies that offer cybersecurity hardware, software, and services.
As of March 18, 2023, WCBR holds 37 stocks from the cybersecurity industry, with the largest holdings including companies such as Crowdstrike Holdings, Zscaler, Fortinet Inc., and Okta Inc. The fund has an expense ratio of 0.45%.
WCBR provides investors with exposure to the growing cybersecurity industry, which is expected to continue to experience significant growth due to increasing cyber threats and the growing importance of data protection. The ETF offers investors a diversified portfolio of cybersecurity companies, reducing the risk associated with investing in a single stock.
In terms of performance, WCBR has performed well since its inception in May 2021. From May 2021 through March 2023, the fund had an average annual return of approximately 32.11%
