See a Big Future for Cybersecurity? Check Out This ASX ETF
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A Promising Investment Opportunity in Cybersecurity
The ASX-listed exchange-traded fund (ETF) Betashares Global Cybersecurity ETF (ASX: HACK) is a promising investment opportunity that could be one of the most appealing funds to own this decade. With governments and businesses expected to continue investing in cybersecurity, even during economic downturns, this ETF aims to provide Aussie investors with exposure to the leading companies in the global cybersecurity sector.
The HACK ETF boasts a diverse portfolio of 32 positions, including global cybersecurity giants such as Crowdstrike, Palo Alto Networks, Thales, Check Point Software, Cloudflare, Okta, and Fortinet. While the US makes up 77.8% of the ASX ETF's portfolio, there is also representation from countries like India, France, Israel, and Japan.
Defensive Earnings Don't Always Translate to Success
While having defensive earnings can be attractive to investors, it's not a guarantee of success. Investors also want to see growth potential, which is where the HACK ETF comes in. With a strong projected growth rate and a range of growth trends that require cybersecurity, this ETF is certainly one to watch (and possibly own).
The Global Cybersecurity Market: A Growing Opportunity
According to Fortune Business Insights, the global cybersecurity market is expected to grow from US$193.7 billion in 2024 to US$562.72 in 2032, representing a compound annual growth rate (CAGR) of 14.3% over that period.
The reporting highlights several growth trends that require cybersecurity, including the growth of the Internet of Things (IoT), cloud technologies, e-commerce, and government. For example, governments around the world are investing in internet security solutions to secure their vast amounts of confidential data and information.
For instance, according to the European Cybersecurity Organization report, in 2020, the government in the U.K. financed around USD 2.30 billion to execute various network and internet security projects in defense and research. This investment will drive the overall adoption rate for IT security solutions across multiple industries, favoring the market's growth during the forecast period.
A Potential for Double-Digit Annual Growth
I think this ASX ETF has a lot of potential, with earnings seemingly on track to grow by double-digits annually over the next several years. Profit growth is normally the key driver of share price growth, so the HACK ETF is definitely one to watch (and possibly own).