This Cloud-Computing ETF Is Loaded With FANG Stocks

It’s been years since cloud computing became a technology buzzword, and the buzz hasn’t really let up. Now, an ETF that tracks that industry is in IBD’s ETF Leaders screen.

First Trust Cloud Computing ETF (SKYY) holds 30 stocks in the cloud business, either providers or heavy users of cloud computing — the data and software shared over the internet rather than on PC hard drives.

Some companies in the fund are cloud-computing pure plays, while others are big users or merely provide support for the cloud-computing space, according to First Trust. About 10% of the portfolio is in what the fund calls technology conglomerates, which are large companies “with business models that indirectly utilize or support the use of cloud-computing technology,” the prospectus explains.

Amazon.com (AMZN), for instance, got about 15% of sales last year from Web Services, its cloud business that has emerged as a major provider of cloud infrastructure services.

Facebook (FB), Netflix (NFLX) and Amazon are the three biggest holdings. With Alphabet (GOOGL) as another large holding, First Trust Cloud Computing is somewhat of a “FANG” ETF, the term used to describe the four internet giants Facebook, Amazon, Netflix and Google’s parent company, Alphabet.

 

The FANG stocks are trading near highs and have contributed to the ETF’s success. So have other components. SAP (SAP), the German business software company, has

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