SKYY: 2 Cloud Computing ETFs to Buy as Digital Transformation Accelerates

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WCLD has an average market cap of $6.73 billion, or about a quarter of SKYY’s average. The ETF currently has 70 holdings, with the top 10 accounting for 18% of the total portfolio. The cloud computing market is shaped by rapid digital transformation, with businesses increasingly adopting cloud tech to enhance scalability, flexibility, and cost-efficiency. This shift boosts demand for tech such as SaaS, serverless computing, and private clouds to effectively manage these evolving environments. Netflix (NFLX 1.49%) made streaming TV from the cloud an everyday staple.

The table shows the returns of all cloud technology ETFs in comparison. All return figures are including dividends as of month end. Besides the return the reference date on which you conduct the comparison is important.

It’s all about growth for this business right now, and even small changes in management’s expectations can cause some wild fluctuations in share price. Snowflake could, nevertheless, be a very promising investment for the long term. High short-term performance, when observed, is unusual and investors should not expect such performance to be repeated. There are greater complexities involved in managing big cloud computing infrastructure, but the cloud also offers the ability to continuously streamline and automate operations. Due to its success in becoming a full-blown tech platform for businesses of all types and sizes, Salesforce is also a top way to play smaller cloud upstarts. It regularly invests in or acquires stakes in smaller cloud peers — such as when it invested in Snowflake (SNOW 0.6%) before its initial public offering (IPO) in 2020 (and sold it for a profit in 2021).

In order to find the best ETFs, you can also perform a chart comparison. When choosing a cloud technology ETF one should consider several other factors in addition to the methodology of the underlying index and performance of an ETF. For better comparison, you will find a list of all cloud technology ETFs with details on size, cost, age, income, domicile and replication method ranked by fund size. Cloud computing picked up steam during the COVID-19 pandemic and has remained an enduring growth story even during the bear market. More efficient than legacy IT, it enhances technology such as artificial intelligence (AI), and machine learning, and gaming.

That’s where DigitalOcean comes in, providing a full range of affordable services to help small companies find their way in the new cloud era. Software company Adobe (ADBE -8.47%) got its start in an IT era that predates both the cloud and the internet. But it has transformed itself into a leader in cloud services by adapting its large and expanding platform to the cloud era. Adobe’s core competencies in providing creativity software and document editing have made it a staple of digital transformation. Cloud computing boomed during the 2010s, but growth in this next-gen IT industry is still in the early innings.

To see all exchange delays and terms of use, please see disclaimer. SKYY shares were trading at $95.91 per share on Wednesday afternoon, up $1.33 (+1.41%). Year-to-date, SKYY has gained 9.40%, versus a 16.49% rise in the benchmark S&P 500 index during the same period. JustETF is the leading knowledge base for your ETF strategies.

In addition to steady growth, ServiceNow also recently turned profitable by all metrics. This could be a great stock holding for the next decade and beyond as the cloud infiltrates more of the world’s corporate operations. Zoom is eyeing a bigger piece of the massive global telecom industry by going after large business communications accounts. Zoom Phone accounts, a service for transferring calls across different devices, has steadily grown for years. Zoom’s contact center services to manage inbound calls and customer contact have also remained a key growth initiative.

Furthermore, global spending on public cloud services is projected to surge by 20.4%, reaching $675.40 billion in 2024. This impressive growth is driven by advancements in generative AI and application modernization. Consequently, cloud computing ETFs offer investors a valuable opportunity to benefit from the expanding cloud industry, capturing the potential of this dynamic sector. Cloud computing ETFs target companies leading the digital revolution by providing essential cloud services such as infrastructure, software, and platforms. As digital transformation accelerates, these ETFs offer investors opportunities for significant growth and innovation, capitalizing on the expanding cloud market.

Be it digital customer experiences, employee workflow management, or software development, ServiceNow enables companies to find chokepoints in their operations. Once finding these pain points, ServiceNow can help suggest and automate fixes. I’ve always liked equal-weight indexes because they give you more of a variety Crypto-funds investments of market caps than cap-weighted indexes. Launched in September 2019, WCLD has $623.4 million in net assets and charges a low 0.45% fee. So we’ll broaden the search to include other technology ETFs with a decent commitment to cloud computing. With $2.87 billion in AUM, the fund has a total of 64 holdings.

The median market cap is $18.2 billion, with price-to-sales (P/S) and price-to-earnings (P/E) ratios of 2.2 and 50.8, respectively. The premiums and discounts for funds with significant holdings in international markets may be less accurate due to the different closing times of various international markets. Because the Funds trade during U.S. market hours while the underlying securities may not, the time lapse between the markets can result in differences between the NAV and the trading price.

For years, organizations around the globe have been migrating their operations to the cloud — digital data and services stored within a remote data center and accessed via the internet. However, the rise of remote work during the pandemic accelerated the trend. Now, generative AI has kicked off the next wave of cloud expansion. New additions to the fund must have at least 15% revenue growth in each of the past two years.

A more recent arrival is the Global X Cloud Computing ETF (CLOU 1.27%). Since the fund launched in early 2019, GlobalX’s cloud ETF has narrowly outperformed First Trust’s offering due to its focus on just 34 stocks, most of which are software companies. The fund is smaller, with slightly more than $600 million in assets under management.

For investors not interested in attempting to pick the best cloud stocks, exchange-traded funds (ETFs) are also an option. The First Trust Cloud Computing ETF (SKYY 0.73%) is the largest cloud ETF around, with about $2.9 billion in assets under management. The fund https://ftb.fund/ is a basket of 64 cloud infrastructure and software stocks. It has an ETF expense ratio of 0.6%, meaning it costs $6 per year for every $1,000 invested. Currently, SKYY has 65 holdings, with four stocks carrying weightings above 4%, including Microsoft at 4.29%.

This tech sector addresses a growing need, presenting tremendous upside. Clicking “Confirm” below will take you to a different website, intended for jurisdictions outside the US. Global X Management Company LLC disclaims responsibility for information, services or products found on the websites linked hereto. All Sector, Industry and Geographic breakdowns, where provided, are based on equity positions held by the ETF and exclude cash, currencies, and other holdings. Cloud computing spans multiple segments, and its most innovative companies include both household names and newcomers from around the world.