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Top 5 Cloud Computing Exchange-Traded Funds ETFs in 2021

Cloud Computing

Cloud computing is on-demand. Storage, servers, databases, networking, software, analytics, and intelligence are examples of these services. A cloud computing Exchange-Traded Fund (ETF) invests in cloud computing businesses. Investing in a basket of cloud computing firms allows you to spread your risk over the whole sector.

 

First Trust Cloud Computing ETF (SKYY):

The First Trust Cloud Computing ETF is the most popular cloud fund, with roughly US$6 billion in assets under management. It has around 60 overall interests, with the top positions comprising well-known big tech names like Google parent Alphabet (GOOGL) and lesser-known names like Kingsoft Cloud Holdings (KC), a roughly US$11 billion Chinese cloud computing business. However, with around 90% of assets in the United States, the international choices represent only a minor component of this cloud computing ETF.

 

Global X Cloud Computing ETF (CLOU):

CLOU is another of the top cloud ETFs, with over US$1 billion in assets under management. It does, however, have a considerably more concentrated list of holdings, with less than 40 overall positions at this time. The portfolio is very evenly distributed throughout this smaller list, with no one holding now worth more than roughly 5% of the fund’s total value. Twilio (TWLO), a cloud-based voice and text messaging service, and Zscaler (ZS), a cloud-based cybersecurity startup, are now among the top holdings.

 

WisdomTree Cloud Computing Fund (WCLD):

This WisdomTree ETF is another about US$1 billion cloud computing ETF. With an annual cost ratio of 0.45%, or US$45 on every US$10,000 invested, it’s also the lowest of the main dedicated funds. Previously, the funds had a return of 0.6% or higher. With more than 50 holdings and no one position accounting for more than approximately 2% of the portfolio, the list is also one of the most diverse – and owing to an “equal weight” strategy, the fund rebalances regularly to attempt to bring each company into line with the others. File hosting service Dropbox (DBX) and payroll and human resources tech provider Paycom (PAYC) are among the company’s top holdings.

 

First Trust Dow Jones Internet Index Fund (FDN):

This approach applies in 2021 to many of the apps you use in your personal or professional life. As a result, FDN is packed with a slew of firms that might be classified as cloud stocks — many of which are now trading at a premium. Amazon.com (AMZN) is a good example, with its rapidly expanding Amazon Web Services subsidiary. Investors seeking exposure to pure cloud-based platforms and service providers might consider smaller stakes in Cloudera (CLDR) and Fastly (FSLY). It’s a sizable cloud computing ETF in its own right, with US$10 billion in assets and a 0.52% cost ratio.

 

ARK Next Generation Internet ETF (ARKW):

Companies that rely on or stand to profit from growing usage of shared technology, infrastructure, and services, internet-based goods and services, innovative payment methods, big data, the internet of things, and social media distribution are the focus of the ARK Next Generation Internet ETF (ARKW). Cloud computing firms account for only 12.5% of ARKW, so it’s far from a pure-play cloud ETF. However, without cloud computing, the “next-generation internet” will not be possible. It has a 1-year performance of 51%, a 0.75% expense ratio, and US$5.91 billion in assets under management.

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