Social trading and investment platform, eToro, has created an investment portfolio comprising leading cybersecurity companies, called the CyberSecurity CopyPortfolio, to be launched on Feabruary 4, 2019.
“In 2018, the world’s attention turned to major corporations as data leaks and massive hacks made headline after headline. Cybersecurity became a hot trend, as the importance of privacy and online protection was heavily debated in the media,” the company said in a newsletter, addresed to the eToro platform users.
With the rise of the GDPR, and growing concerns over online security, eToro’s Investment Committee created the CyberSecurity CopyPortfolio. The portfolio aims to provide investors with exposure to cybersecurity companies, working to protect commercial entities, private individuals, government and military institutions and more. This Portfolio contains large cap, global public companies which are participants in the online cyber technology industry. CyberSecurity CopyPortfolio includes companies dealing with global cybersecurity threats, military cyber threats and cyber threats to enterprises. CopyPortfolio is a portfolio management product by eToro. The investment strategy allocates equal weight to each stock within its composition, to create a managed, balanced portfolio that gives investors one-click exposure to one of the most innovative and interesting fields in technology tod
According to eToro, up until recently, Cybersecurity has been the sole concern of large organizations, protecting their IP and data. However, the context of Personal security and cyber crimes is becoming more relevant with every IOT appliance and new applications used through our mobile devices. The technological revolution has shifted these concerns from personal physical safety to protecting our digital entity from misuse of our identity and personal data.
With renewed interest in online safety and privacy, the cybersecurity sector is attracting increasing attention in the investment world.
One of the reasons cyber security is, and will remain, a hot topic is the ever-changing nature of the online world. With so much sensitive information being stored in the cloud and on computer networks, the risks are ever growing and the need for effective cyberdefenses is ever present. From “simple” risks, such as phishing scams, to complex ransomware programs and crypto mining bots, each person and enterprise with an online presence is in danger of falling victim to a cyber attack, the company says.
“eToro’s research team has been following the trends in the Cyber industry and has composed an attractive long-term exposure to this sector that is expected to demonstrate substantial growth in the coming years,” reads the official announcement. In the same announcement, eToro has also outlined key elements about CyberSecurity CopyPortfolio portfolio.
According to the trading platform, CyberSecurity CopyPortfolio invests primarily in equity securities of companies that are directly or indirectly involved in the development of innovative cybersecurity solutions. This covers global companies from various markets that are both active in traditional forms of the industry and looking to innovate their product offering, complemented by companies that are fully engaged in R&D, focusing on the introduction of new cyber solutions.
eToro says that investment horizon-investors should see this as a long-term investment, taking advantage of the continues potential growth of this industry in new verticals. The cybersecurity sector is already an established industry, however, it is continuing to develop itself to match the technological disruption we are witnessing in the last decade. The cybersecurity industry is huge, estimated at more than $150 billion in 2018, and projected to grow to $230 billion within 4 years.
The company warned that long-term investments can go through market cycles, where the market drops over sustained periods, this has happened recently. “Please be aware of this when initially opening your investment. In addition, innovative and disruptive companies are exposed to short-term volatility derived from legislation, regulation, market rumors and other factors that can cause short-term volatility,” the company stressed.
A substantial portion of the business segment in some of the companies within the CopyPortfolio are not necessarily fully engaged in innovative cyber-related activity, and therefore, their performance can also be influenced by factors unrelated to this industry, such as macroeconomic conditions.
CyberSecurity CopyPortfolio is a semi-passively managed long-term investment strategy. The portfolio will only be rebalanced on demand for reasons such as a stock being de-listed, merger or acquisition or a stock suspending their participation/development plans in this industry. In some cases, the Investment Committee may take active measures to rebalance the portfolio based on significant events or publications in order to ensure the best interest of the investors. This will be communicated in advance.
In addition to any capital gains, investors in this portfolio will also receive dividends paid out by these stocks when announced quarterly, half-yearly or end of the year. eToro also said that the minimum to invest in this CopyPortfolio is $5,000.