With the increasing use of technology, cyber attacks are constantly rising. Consequently, there has been a need for companies and governments to secure networks and protect individuals against cyber attacks. Hacking has been in the news a lot, and there’s a slew of news coming out indicating hackers aimed to hack into voter registration systems.
Additionally, French Presidential candidate Emmanuel Macron has been the latest target of hacks and “fake news”. With that in mind, if governments and elections could be targeted and hacked, individuals are at risk. This has caused many to realize we need to increase cybersecurity to protect ourselves.
Cyberattacks are on the Rise and Companies are Taking Note
According to Neena Mishra, Director of ETF Research for Zacks Investment Research, “Our world is becoming increasingly digital and interconnected, bringing us new opportunities, but also creating enormous challenges. Abundance of digital information and sophisticated tools available to process and share that information make it very hard to ensure data security in this interconnected world. That is why cybersecurity threats and cyberattacks are on the rise.”
Trader Jason Bond stated in an ETF newsletter, “The recent news of hacks could attract some investors to cybersecurity-related companies. The industry could make for a very interesting investment now that President Trump is looking to increase cybersecurity”
Cybersecurity pros are taking note and are gathering to fight against cybersecurity attacks. Thousands of cybersecurity professionals assembled to the RSA cybersecurity conference, and it seems as if they’re looking to beef up security. This should drive business and revenues in the cybersecurity industry.
Moreover, the Cyber Threat Alliance, a group of cybersecurity firms, has been increasing its efforts to share their intelligence on cybersecurity threats. The Cyber Threat Alliance is looking to expand, and that could benefit companies included in the group.
Cybersecurity Industry Could See Strong Momentum
Countries are moving to protect themselves against hacks. This includes the U.S. and the U.K., which are looking to increase cybersecurity. The U.K. government officially launched its National Cyber Security Centre on February 14, 2017. The Centre is aimed to protect authorities and companies against cyberattacks, and it could leverage the technology of some cybersecurity firms, which would help to boost revenues in those companies.
In mid-December 2016, we saw Yahoo disclose that it experienced a major hack, the second hack of the year. The cyberattack affected over 1 billion users. Now, this shows that many consumers, governments and large companies are at risk and could be hacked at any time. One exchange-traded fund (ETF) that could benefit from the potential increase in cybersecurity is the PureFunds ISE Cyber Security ETF (NYSEARCA: HACK).
PureFunds ISE Cyber Security ETF is the world’s first cyber security ETF, and it provides investors with exposure to the industry. The ETF is comprised of technology companies that offer software, consulting and hardware services to protect companies, governments and individuals against cybercrime.
With the ongoing shift to increase cybersecurity, some traders believe the PureFunds ISE Cyber Security ETF could be a worthwhile investment. Moreover, there have been some political changes that could come about, including Israeli Prime Minister Benjamin Netanyahu and President Trump’s meeting, which could help the U.S. President draft up a more detail executive order for cybersecurity.
The Bottom Line
Cyberattacks are on the rise, and cybersecurity companies are looking to lead the fight against cybercriminals. Countries have been looking to increase cybersecurity, which could bolster cybersecurity companies. Consequently, one ETF tracking cybersecurity-related companies could experience a move higher.