The end of 2018 may have burned an image of volatility in investors’ minds that would drive their decisions when reassessing their portfolios for 2019. Much of that occurred in a downtrodden technology sector that saw major sell-offs in the fourth quarter of last year, which may have seen the run end for FAANG (Facebook, Amazon, Apple, Netflix, Google) stocks.

That being said, where is the next tech boom? That could be in disruption where innovations like robotics, artificial intelligence (AI), machine learning, or any other type of disruptive technology can lead the next revolution in the exchange-traded fund (ETF) space.

On the Inside the Disruptive Technology Revolution panel:

  • Paul Dellaquila, Managing Director, Global Head of ETFs at Defiance ETFs
  • Matthew Weglarz, Director and Portfolio Manager, Tortoise
  • Catherine Wood, Chief Investment Officer and CEO, ARK

Disruptive technology is not relegated to certain sectors as it will permeate into all industries in some form or fashion. For example, augmented reality is technology comprised of digital images superimposed over the real world, and its use is primed to drive industry growth–industries like real estate and manufacturing are already putting the technology to use in a variety of ways.

“There is so much changing today with five innovation platforms happening at the same time,” said Wood.

“Disruptive innovation is going to change the world works,” added Wood. “It’s doing to cause a lot of disintermediation.”

ARK presented its own view on identifying investable innovation platforms, which can cut across various sectors:

Virtual Summit Recap - Getting Inside the Disruptive Revolution 1ARK showed Virtual Summit viewers how financial advisors are using ARK’s innovative ETFs in the marketplace as a means of portfolio diversification, alpha and hedging.

Virtual Summit Recap - Getting Inside the Disruptive Revolution 2

Tortoise presented its focus on digital infrastructure, which is “the backbone of the digital revolution, including everything that transfers, stores and processes digital information.” Tortoise’s strategy identifies the areas of growth that are occurring at a rapid pace–one of those areas is cloud computing.

Virtual Summit Recap - Getting Inside the Disruptive Revolution 3

Financial technology is also seeing a growth spurt with the more prevalent use of electronic payment methods driving online transactions. This rise has caused “much higher growth with global ecommerce,” according to Weglarz.

Virtual Summit Recap - Getting Inside the Disruptive Revolution 4

Dellaquila presented on a growing technology that could revolutionize all industries in the near term–5G technology. In the not-so-distant future, 5G technology could be a major disruptor and one such opportunity to take advantage of this is the 5G ETF (FIVG) from Defiance ETFs.

Being able to transmit copious amounts of data at a faster rate is certainly of benefit for wireless companies and their users, but 5G could be a major disruptor in various industries.

“5G is more about places, people and machines,” said Dellaquila.

Virtual Summit Recap - Getting Inside the Disruptive Revolution 5All the discussion disruptive technology circles back to one underlying theme–the ETF and its own disruption in the financial world.

“ETFs are the most disruptive thing to happen in this industry,” said Dellaquila.

ETFs mentioned during the presentation:

Missed the Virtual Summit? Make sure to check back when the complete Virtual Summit is available on demand: https://www.etftrends.com/virtual-summit.

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