If you are a technology enthusiast like me and believe that innovation and disruptive technologies are what you need to be investing your money on then read on.
With so many public companies working on innovative and disruptive technologies, sorting through the clutter is very difficult and just cumbersome. Of course there are those well known companies like Google, Amazon, Apple, and even NVIDIA to name a few of them but outside of these big names, there is a myriad of small to medium sized firms that are likewise working on very innovative and disruptive technologies. Blockchain, IoT or internet of things, self-driving/autonomous vehicles, robotics, VR or virtual reality, drone technology are just a few of them that will power the day to day lives of the future. So the question is how do you possibly get exposure to these companies without having to spend days and months researching. My solution is investing through ETFs or Exchange Traded Funds that specializes on investing on these types of companies. In other words the company that owns the ETF have done the job of researching companies, reviewing their financial health, attending their conference calls, reviewing their projects, etc. then made a determination that these companies align with the investing goal of the ETF. So what you have to do is simply just invest on this ETF and you get exposure to a good amount of companies that’s involved in those technologies.
Important thing to remember is that each ETF is different depending on the “theme” or “goal” of the ETF so it’s best to read the ETF’s goal or theme so you understand what types of companies the ETF is investing on. I personally look at the current holdings of a particular ETF, review the history of the stocks performance then research 1 or 2 companies they are holding on the ETF to make sure it aligns to the type of company and/or technology I want to invest on. I likewise look at the expense fee of the fund which is what you are paying for when investing on the ETF. This is the fee that the company charges for managing the ETF. This fee is taken out of the ETF’s returns so it’s mostly out of sight out of mind since it’s not a separate line item you see on a statement. A lot of financial advisors have argued that these fees are a bad thing however I see it differently. Paying for all the legwork of managing an ETF is worth it and will ultimately result in a higher quality ETF that results in the price of the ETF going higher.
So let’s go to the fun part. Below is the list of ETFs that are currently available in the market that specializes on investing in companies that are working on technologies for the future generation. This list is by no means exhaustive but includes ETFs that I am either currently invested on or looking to invest on in the near future. The last 5 are being marketed as Blockchain ETFs or companies engaged with cryptocurrencies aka Bitcoin and blockchain technology in general. As mentioned please review the profiles and investing goals of these ETFs to make sure it aligns with your intentions and goals. Also don’t forget to look at the performance of the ETF before making any decision to invest on it. There are many websites out there that provides you this information aside from the links I provided below. I personally use a Google Finance and ETFDB for these since I get all the information I need from those sites before I decide to invest or not.
Robo Global Automation and Robotics ETF: ROBO
SPDR Factset Innovative Technology ETF: XITK
Robotics and Artificial Intelligence ETF: BOTZ
Alps Disruptive Technologies ETF: DTEC
Ark Innovation ETF: ARKK
Ark Industrial Innovation ETF: ARKQ
Global X Future Analytics Tech ETF: AIQ
Ishares Exponential Technologies ETF: XT
Fintech ETX : FinX
Rex BKC ETF: BKC
First Trust Indxx Innovative Transaction & Process ETF: LEGR
Reality Shares Nasdaq NexGen Economy ETF: BLCN
Amplify Transformational Data Sharing ETF: BLOK
Innovation Shares NextGen Protocol ETF: KOIN
Note: I am long on ROBO, XITK, BOTZ, DTEC, ARKK, ARKQ