Investors looking to capitalize on growth within the Internet of Things (IoT) theme have some exchange traded funds to consider, including the Global X Internet of Things ETF (NasdaqGS:SNSR).
SNSR targets companies involved in the the development and manufacturing of semiconductors and sensors, integrated products and solutions, and applications serving smart grids, smart homes, connected cars, and the industrial Internet. The ETF debuted in September 2016. SNSR tracks the Indxx Global Internet of Things Thematic Index.
“The Internet of Things encompasses quite a wide variety of technologies involved in connecting sensors and machines to other machines to create increasingly complex webs of connected devices for automation and other purposes,” reports Nanalyze. “One of the most basic examples is having your thermostat, locks or lights in your home digitally connected to respond to certain conditions or by voice command. A more complex setup might involve a farm with various sensors in the field that continuously relay data, usually through a cloud-based platform, about the health of the crops.”
A Deeper Dive Into SNSR
At the end of last year, SNSR held 45 stocks, over 43% of which were semiconductor names. Electrical components and consumer electronics companies combined for a quarter of the ETF’s weight. SNSR features exposure to 13 countries, but the U.S. and Switzerland combine for over 78% of the fund’s geographic exposure.
“If you would have invested $1000 back on 06/30/2010 when the index began tracking, then today you would have about $3,255 without taking into account any fees. That’s a return of about +226% and certainly beats the S&P500 return of +151% over the same time frame,” according to Nanalyze.
However, SNSR has lagged the Nasdaq 100 Index since coming to market. SNSR charges 0.68% per year, or $68 on a $10,000 investment, making the IoT fund pricier than traditional technology ETFs.
“SNSR enables investors to access high growth potential through companies at the leading edge of the IoT, transforming how humans interact with tech-enabled devices, and how devices interact with each other,” according to Global X.
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The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.