Financial technology could pay investors back in gains for the remainder of 2021. They may want to consider the Global X FinTech ETF (FINX) as the space continues to grow.
“Coronavirus created quite a disruption to the global economy in 2020, and complications still linger,” a MarketWatch report said. “However, the pandemic proved once and for all the power and portability of digital technologies. This is old news to retailers, many of whom have been feeling the pain at bricks-and-mortar stores for years, but it’s a trend other areas of the economy have been slower to embrace — including financial services.”
FINX seeks to provide investment results that correspond to the Indxx Global Fintech Thematic Index. The index is designed to provide exposure to exchange-listed companies in developed markets that provide financial technology products and services, including companies involved in mobile payments, peer-to-peer (P2P) and marketplace lending, financial analytics software, and alternative currencies, as defined by the index provider.
FINX gives investors exposure to:
- High Growth Potential: FINX enables investors to access high growth potential through companies that are applying technological innovations to disrupt and improve delivery of financial services.
- An Unconstrained Approach: FINX’s composition transcends classic sector, industry, and geographic classifications by tracking an emerging theme.
- ETF Efficiency: In a single trade, FINX delivers access to dozens of companies with high exposure to the FinTech theme.
“FINX is one of the best options to look at if you believe in the fintech megatrend,” the MarketWatch report added. “This $1 billion ETF is a who’s who of the space, with big names like PayPal as well as smaller firms with a lot of growth ahead of them like digital invoicing firm Bottomline Technologies EPAY. There are other ETFs out there, some of which play specific trends like mobile payments or blockchain if you’re into that, but this is an established option with a lot of interesting holdings.”
The fund is up almost 50% within the past year:
The fund’s one-year chart reveals the obvious momentum in FINX, particularly after the pandemic sell-offs, which saw the fund rise over 125% since March 23, 2020. For investors looking for an opportune time to buy, gauging momentum could help via the relative strength index (RSI).
The fund has yet to breach overbought levels, so for traders looking for an area of value may want to see if it falls closer to its 50-day moving average. Now might be a time to get in for the long-term buy-and-hold investor.
For more news and information, visit the Thematic Investing Channel.