Exchange traded funds tracking the technology sector, the largest sector weight in the S&P 500, have been solid though not spectacular performers this year. For example, the Technology Select Sector SPDR (NYSEArca: XLK), the largest tech ETF by assets, and the Vanguard Information Technology ETF (NYSEArca: VGT) are up an average of 4.6% year-to-date.
Those performances are nice, but they are also well off the 19% returned by the PureFunds ISE Cyber Security ETF (NYSEArca: HACK). Although HACK, the first dedicated cyber security ETF has retreated in recent weeks, that 19% gain is enough to make the fund one of this year’s top-performing sector ETFs that is not a healthcare or biotech fund. Each of the top 10 non-leveraged sector ETFs on a year-to-date basis are biotech or healthcare funds. [Headlines Help HACK]
Investors are responding the phenomenon that is HACK by continuing to pump cash into the ETF.
“While investors yanked $730 billion out of the tech sector – with more than ten ETFs seeing outflows – the PureFunds ISE Cyber Security ETF (HACK) has taken in $115 million. HACK is now at $1.3 billion in assets, a number that is much larger than anyone would have predicted when it was launched less than a year ago. Much of the cash coming in is due a renewed focus on cyber-security in all businesses,” reports Eric Balchunas for Bloomberg.
On June 18, PureFunds officially said HACK had $1 billion in assets under management. In about a month of trading since then, HACK has swelled to over $1.3 billion in assets. To be precise, HACK had $1.33 billion in assets as of July 16. [HACK Hits $1B in Assets]
During the second quarter, investors pumped $650.2 million into HACK, more than $540.6 million in combined inflows to XLK and VGT. Since the start of this month, investors have added $129.6 million to HACK while pulling a combined $558 million from XLK and VGT.