From 2005 to 2012, global software sales nearly doubled to rougly $270 billion from $143 billion. That number is forecast to grow to $330 billion this year, so it is reasonable that tactical investors consider exchange traded funds with a dedicated software focus.

A hidden gem among software ETFs is the PowerShares Dynamic Software Portfolio (NYSEArca: PSJ). PSJ, which is just two months shy of its tenth anniversary, is up 7.8% this year, an advantage of 150 basis points over the Nasdaq Composite. On Wednesday, PSJ was one of 36 ETFs to hit an all-time high. [Sector ETFs for Cyclical Trends]

Like other well-known PowerShares industry ETFs, including the PowerShares Dynamic Biotechnology & Genome Portfolio (NYSEArca: PBE) and the PowerShares Dynamic Pharmaceuticals Portfolio (NYSEArca: PJP), PSJ tracks an Intellidex index that “is designed to provide capital appreciation by thoroughly evaluating companies based on a variety of investment merit criteria, including: price momentum, earnings momentum, quality, management action, and value,” according to PowerShares.

PSJ’s 30-stock roster is home to some familiar software names including Dow component Microsoft (NasdaqGS: MSFT), video game publisher Electronic Arts (NasdaqGS: EA), QuickBooks and TurboTax publisher Intuit (NasdaqGS: INTU) and King Digital (NYSE: KING), the maker of Candy Crush Saga. Those stocks combine for 17.6% of the ETF’s weight.

In addition to those well-known software names, what makes PSJ compelling is its exposure to two prominent technology themes: Cloud computing and cyber security. At least three PSJ holdings are also constituents in the First Trust ISE Cloud Computing Index Fund (NasdaqGM: SKYY), which also made an all-time high yesterday. The global cloud computing market is expected to expand 30% per year and hit $270 billion by 2020.

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