“As businesses and consumers continue to migrate to a cloud environment, we believe there are significant growth opportunities for the companies involved in all aspects of cloud computing,” said Ryan Issakainen, vice president and ETF strategist at First Trust. “The ETF provides a way to gain diversified exposure to those companies.”
He added Forrester Research is projecting total public cloud revenues to rise 27% annually to reach nearly $160 billion by 2020, up from $15 billion in 2010.
Roger Nusbaum at TheStreet.com notes that the inclusion of Netflix (NasdaqGS: NFLX) in the new ETF has raised eyebrows.
“Despite the skepticism that some might have for a cloud computing ETF, the theme is legitimate and has plenty of investor interest,” he wrote. “The existence of an ETF simply offers another choice and for some investors interested in the cloud it will be the best choice, most likely because it offers access without single-stock risk.”
Tisha Guerrero contributed to this article.