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Technology is integral to almost every aspect of our lives, playing a part in our day from the moment we wake up in the morning, to the moment we go to sleep at night. Our daily interactions with each other, and with businesses, largely take place online – activities such as shopping, banking, entertainment, and social networking.
Few industries remain untouched by technological advances, and the ability to access much greater computing power at far lower cost has led to significant developments in business and society. It is reported that globally, people spend on average almost 7 hours online daily¹ and the global artificial intelligence market size is expected to reach nearly USD 400 billion by 2025.²
The technology sector has offered significant opportunities for growth investing in recent years.
What are tech ETFs?
Similar in structure to a traditional managed fund, an ETF is an investment fund that is bought and sold on a stock exchange just like any share.
Tech ETFs generally allow you to invest in a portfolio of companies within the technology and related sectors and typically aim to track the performance of an index.
BetaShares provides a range of technology investment funds. Some of our technology ETFs offer broad exposure, holding a portfolio of global or regionally-based technology and related companies in the following categories:
- Companies listed on the Nasdaq-100 (ASX: NDQ)
- Asian Technology Tigers (ex-Japan) (ASX: ASIA)
- Australian Technology Sector (ASX: ATEC)
Others offer exposure to a particular thematic, holding a portfolio of technology companies with a more specific focus:
How to use technology ETFs in a portfolio
Investors are typically attracted to technology stocks for their long-term growth potential.
Some tech ETFs aim to track a market cap-weighted index, for example, the Nasdaq-100 in the U.S., or the S&P/ASX All Technology Index in Australia. These ETFs offer broad tech-related exposure to technology stocks traded in a particular market and can be used as a ‘core technology’ allocation.
Other technology ETFs provide more focused exposure to a particular technology theme, such as cybersecurity or cloud computing.
Investors can use these more focused technology ETFs in their portfolio as a complement to a broad-based technology exposure such as an international technology ETF that aims to track the Nasdaq-100, or as a tactical allocation to a technology theme they are interested in.
How to buy a tech ETF in Australia
Tech ETFs can be bought and sold just like you’d buy or sell any share on the ASX.
What are the benefits of investing in technology ETFs?
Here are some reasons to consider a technology ETF as part of your portfolio:
- Growth potential – The technology sector has been one of the fastest-growing sectors globally.
- Diversification – Technology is under-represented on the Australian sharemarket, and so more specific exposure to technology and related sectors offers potential diversification benefits to portfolios that may be heavily weighted towards sectors such as financials and resources.
- Exposure to global giants – Market-leading technology stocks such as Amazon, Apple, and Facebook are some of the largest companies in the world.
- Access to particular thematics – Our HACK, CLDD and RBTZ ETFs offer diversified exposure to a particular technology sub-sector with the potential for strong growth.
What are the risks of investing in technology ETFs?
There are risks associated with an investment in the technology ETFs, including market risk, technology sector risk, concentration risk, and currency risk, as well as emerging markets risk (for ASIA) and smaller companies risk (for RBTZ).
More information on risks and other features of each ETF can be found in the applicable Product Disclosure Statement.
Global Market Exposure
| ASX Code | Description | Factsheet |
|---|---|---|
| NDQ | BetaShares NASDAQ 100 ETF - Gain exposure to many of the world’s most innovative companies that are revolutionising our everyday lives – including Apple, Amazon, Google and more. | Download |
| HNDQ | BetaShares NASDAQ 100 ETF – Currency Hedged - Aims to track the performance of the NASDAQ-100 Currency Hedged AUD Index | Download |
Thematic Exposures
| ASX Code | Description | Factsheet |
|---|---|---|
| HACK | BetaShares Global Cybersecurity ETF - Gain exposure to the world’s leading cybersecurity companies – a sector with strong growth prospects. | Download |
| RBTZ | BetaShares Global Robotics and Artificial Intelligence ETF - Invest in the companies leading the Robotics and Artificial Intelligence (A.I.) megatrend – a sector likely to have a profound impact on the world of tomorrow. | Download |
| CLDD | BetaShares Cloud Computing ETF - Exposure to some of the world’s leading companies in the cloud computing industry. | Download |
| DRIV | BetaShares Electric Vehicles and Future Mobility ETF - Gain exposure to leading global innovators in automotive technology. | Download |
| GAME | BetaShares Video Games and Esports ETF - Access the growth potential of the global video games and esports industry. | Download |
| IPAY | BetaShares Future of Payments ETF - Gain exposure to leading companies innovating in the global payments sector. | Download |
Investing involves risk. The value of an investment and income distributions can go down as well as up. Before making an investment decision you should consider the relevant Product Disclosure Statement (available at www.betashares.com.au) and your particular circumstances, including your tolerance for risk, and obtain financial advice. An investment in any BetaShares Fund should only be considered as a component of a broader portfolio.
1. https://wearesocial.com/global-digital-report-2019
2. https://www.grandviewresearch.com/press-release/global-artificial-intelligence-ai-market
