Work From Home (WFH): An ETF For Now And For The Future

While it has been an undoubtedly challenging and difficult time, with an increasing number of individuals continuing to work from home due to the coronavirus pandemic restrictions and regulations, a number of companies have benefitted from the transition. Businesses that focus on cybersecurity, communications, and project management have all seen an uptick. Given this transition, for investors who are looking for a way to invest in these companies without opting to buy them separately, an ETF like the Direxion Work From Home ETF (WFH) could be worth exploring.

WFH is a unique fund that offers exposure to companies across four technology pillars, allowing investors to gain exposure to those companies that stand to benefit from an increasingly flexible work environment. The four pillars include Cloud Technologies, Cybersecurity, Online Project and Document Management, and Remote Communications. Companies are selected for inclusion in the index by ARTIS, a proprietary natural language processing algorithm, which uses keywords to evaluate large volumes of publicly available information, such as annual reports, business descriptions, and financial news.

“Firms big and small are going from just a few people working remotely to everyone,” said Inkoo Kang, Direxion Product V.P.

The fund capitalizes on the idea that Covid-19 could not only change the short term plans for many businesses but could start a trend that could be more enduring as well.

“This revolution is causing businesses large and small to reinvent the workplace. With the onset of COVID-19 we have seen that revolution just accelerate dramatically,” said President of Direxion, Robert Nestor.

With companies like Apple and Twitter making work at home more commonplace, considering possible permanent options for employees who would elect that situation, the Work At Home Direxion ETF could stand to benefit from the changes.

“CFOs have said 54% of companies are going to make remote work a permanent option. I actually feel like I’m more productive working from home than I actually was in the office,” said David Mazza, Managing director, head of product.

Mazza explained that the WFH selects stocks using artificial intelligence to create a balanced mixture of different and developing technologies that are likely to benefit most from the transition to virtual work during the coronavirus pandemic and beyond.
“Our Work at Home’s benchmark Index comprises four established and emerging technologies— 10 stocks in each category. With employees in disparate locations, the ability and requirement to be able to access data anywhere is only going to increase going forward,” said Mazza.
“The fund’s benchmark Index selects securities using a type of artificial intelligence called natural language processing to identify the best stocks that are going to be representative of the themes powering Work From Home,” explained Mazza.
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