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November 13, 2014 at 11:15 AM
Targeting a new growth area in emerging technologies, Factor Advisors, a subsidiary of ETF Managers Group, in partnership with PureFunds and ISE ETF Ventures launched Wednesday what it says is the first cybersecurity exchange-traded fund.
The PureFunds ISE Cyber Security ETF (HACK) seeks to replicate the price and yield performance of the ISE Cyber Security Index, which holds shares of 30 companies that are immersed in protecting critical cyber infrastructure.
The fund has an annual expense ratio of 0.75 percent.
See also: American Funds: Right kind of active management can trounce ETFs
Christian Magoon, founder of YieldShares and consultant to ISE ETF Ventures, told our sister site, ThinkAdvisor, in a Wednesday interview that the new cybersecurity fund focuses on companies that offer infrastructure, software and hardware, as well as firms that offer consulting and monitoring of cyber risks “by actual people.”
Magoon says that “traditional indexes don’t delineate these types of services,” but instead lump them under such categories as communication equipment, internet software and service, or a systems software company “like those that provide VPN software.”
The 30 companies tracked by the ISE Cyber Security Index specialize in “services designed to protect computer hardware, software, networks and data from unauthorized access, vulnerabilities, attacks and other security breaches,” Magoon says.
