Zoom Video Communications is giving investors something to talk about–as long as they’re maintaining a distance of six feet per social distancing standards and practices amid this coronavirus madness that’s infecting the capital markets. That said, it’s companies like Zoom that have been unflappable during this panic-selling.
Per an Investor’s Business Daily report, “Zoom Video Communications has delivered impressive EPS growth ranging from 275% to 800% over the last three quarters, albeit from low single-digit EPS. Quarterly revenue gains have come in between 78% and 182% across the last eight reports.”
“The coronavirus pandemic has brought new terms—like “social distancing” — into our lexicon,” the report added. “It’s also generated more demand for Silicon Valley-based Zoom. The provider of online meeting and collaboration tools is certainly benefiting from a growing movement to have employees work from home. Even before the coronavirus crisis hit, demand for Zoom stock was strong and seems likely to continue after the crisis.”
For investors looking at ETFs that have exposure to Zoom, they can start with a technology and e-commerce-focused fund like the Kevin O’Leary-sponsored Global Internet Giants ETF (OGIG). OGIG debuted in the markets in June 2018 and has been offering investors access to a wide variety of both domestic and international stocks.
Another fund to check out is the WisdomTree Cloud Computing Fund (WCLD), which also has Zoom exposure. WCLD seeks to track the price and yield performance of the BVP Nasdaq Emerging Cloud Index, which is designed to track the performance of emerging public companies primarily involved in providing cloud computing software and services to their customers.
Capitalizing on Communications
For a broad communications play, investors can give the Communication Services Select Sector SPDR Fund (XLC) a call, but for traders looking for a fund with some 3x juice, then the Direxion Daily Communication Services Index Bull 3X Shares (NYSEARCA: TAWK) will do the trick.
TAWK seeks daily investment results equal to 300 percent of the daily performance of the Communication Services Select Sector Index. The index includes domestic companies from the communication services sector, which includes the following industries: diversified telecommunications services, wireless communication services, media, entertainment, and etc.
With the transparency and liquidity of an ETF wrapper that incorporates multiple hedge fund strategies, funds like TAWK opens up the arena to all types of investors irrespective of net worth. In addition, the communications sector can be used as a defensive maneuver amid the coronavirus outbreak, making TAWK a good option that’s not relegated to just leverage-hungry traders.
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