Detailed Guide to Cloud Computing ETFs – June 8, 2022

The cloud computing industry continues to see increased usage and growing popularity. It has become integrated into the digital world as corporations continue to adopt it or upgrade their existing platforms.

In particular, cloud computing and storage have enabled video conferencing, gaming, e-commerce shopping, remote project collaboration, online classes, editing, and more. It has also found applications in social networking, messaging and streaming services. Cloud computing supports organizations in remote information processing, development, and operation of key applications and services.

The shift to digitalization must remain robust even after the pandemic, holding companies dependent on cloud-based services to drive that shift. In the post-pandemic period, the adoption of cloud technology is projected to witness strong growth in sectors where work from home or hybrid work initiatives are helping to maintain business functions.

In particular, the global market size of cloud computing is forecast to rise from $ 380.25 billion in 2021 to $ 1.614.1 billion by 2030, seeing a CAGR of 17.4%, according to a report by Precedence Research. In fact, North America dominated the global cloud computing market in 2021 with 40% of revenue.

Bright Perspectives for a Cloud Computing Industry

The world is enjoying the benefits of this cost-effective technology. By switching to cloud computing, corporations can avoid making huge investments in expensive hardware and software or operating on-site data centers.

The cloud computing platform also offers a high degree of reliability. It provides simple and economical resources to deal with issues such as data backup and other digital storage-related concerns because data mirroring is allowed at several locations.

In addition, this cutting-edge technology is fast and secure. Cloud computing services provide consumers with a higher level of flexibility and reduce capacity planning burden. Cloud computing platform providers offer a wide range of policies, technologies, and controls that enhance security and ensure data protection. These also secure apps and other infrastructure from cyber threats.

In particular, Gartner reportedly projected that end-user spending on public cloud computing should will increase by 20.4% in 2022 globallyto a total of $ 494.7 billion, up from $ 410.9 billion in 2021. End-user spending is projected to climb to about $ 600 billion in 2023.

Commenting on the platform, Sid Nag, vice president of research at Gartner, said: “Cloud is the power that drives today’s digital organizations. drive specific, desired business and technology results in its digital transformation journey, ”according to the Gartner report.

Integrating cloud computing with AI, big data and IoT will help businesses reach new levels of success in innovation. Global cloud revenue is expected to be $ 474 billion in 2022, up from $ 408 billion in 2021, according to a Gartner report. It is also projected that more than 85% of organizations will adopt the first cloud principle by 2025, according to the same Gartner report.

In this regard, Milind Govekar, senior vice president at Gartner, reportedly commented that “Adopting cloud-based platforms means that digital or production teams will use architectural principles and capabilities to leverage their own capabilities within the cloud environment. -the native environment will be spread, not just popular and anything cloudy will be considered heritage. “

In addition, Gartner projects the higher utilization of cloud computing technology as a proportion of IT spending after a pandemic. In fact, it is expected that IT spending on public cloud computing within several addressable market segments will outpace investments for traditional IT in 2025.

Major Players Expanding Cloud Computing Suite

Recent earnings results from Amazon (AMZN), Microsoft (MSFT) and Google parent Alphabet (GOOG) have benefited from the rise in their cloud computing businesses.

Amazon is a leading provider of cloud infrastructure as a service to enterprise customers. Amazon Web Services (AWS) ‘s growing customer base driven by its expanding cloud offerings will continue to support Amazon’ s leadership in the global cloud market.

Meanwhile, Alphabet is gaining market share in cloud computing behind its enhanced cloud service offerings. In particular, GOOGL’s cloud offerings – Google Cloud Platform and Google Workspace – continue to gain momentum in the growing cloud computing market. Furthermore, Google’s growing investments in infrastructure, security, data management, analytics, and AI remain significant positives. GOOGL’s strategic partnerships and acquisitions, and the growing number of data centers are helping it increase its global cloud footprint. In particular, Google Cloud’s first quarter 2022 revenue rose 43.8% year-over-year to $ 5.8 billion, accounting for 8.6% of quarterly revenue.

Microsoft is also making progress in the cloud computing market. With Azure, it offers cloud-based solutions that provide customers with software, services, platforms and content. In fact, revenues from Azure and other cloud services grew 46% year-over-year (up 49% at constant currency), driven by robust growth in consumer-based commerce and a recovery across industries in the third fiscal quarter of 2022.

Cloud Computing ETFs to Keep Track

Here are some ETFs that can benefit from the growing demand for cloud computing:

First Trust Cloud Computing ETF (HEAVEN Free Report)

First Trust Cloud Computing is looking for investment results that generally match the price and performance, in terms of fees and expenses, of the ISE CTA Cloud Computing Index. It tracks the performance of companies actively involved in the cloud computing industry. The fund holds about 71 securities in its basket, with VMware, Inc., Pure Storage, Inc. (Class A), Oracle Corporation and Lumen Technologies Inc making the top four properties. SKYY has an AUM of $ 3.94 billion and an expense ratio of 0.60%.

Global X Cloud Computing ETF (NAIL Free Report)

Global X Cloud Computing ETF seeks to invest in companies positioned to take advantage of the increased adoption of cloud computing technology, including companies whose core business involves offering Computer Software as a Service (SaaS), Platform-as-a-Service . PaaS), Infrastructure-as-a-Service (IaaS), managed server storage space and data center real estate investment trusts, and / or cloud and edge computing infrastructure and hardware. The fund holds about 36 securities in its basket with cloud-based companies such as DigitalOcean Holdings, Zoom Video Communications-A and Salesforce, Inc., which holds the top three positions. CLOU has an AUM of $ 739.1 million and an expense ratio of 0.68% (read: 5 Top Rated ETFs Notable for June).

WisdomTree Cloud Computing ETF (WCLD Free Report)

WisdomTree Cloud Computing ETF seeks to track the price and performance performance, before fees and expenses, of the BVP Nasdaq Emerging Cloud Index, an equally weighted index designed to measure the performance of emerging public companies focused on delivering cloud-based software to customers. . Anaplan Inc, Qualys Inc and Tenable Holdings Inc hold the top three positions in the fund. WCLD has an AUM of $ 711.3 million and an expenditure ratio of 0.45% (read: 5 Discounted ETFs to Buy at Attractive Prices).

Wedbush ETFMG Global Cloud Technology ETF (IVES Free Report)

Wedbush ETFMG Global Cloud Technology ETFs are designed to access the cloud infrastructure and cloud “enabler” companies that are expected to drive the next 10 years with an estimated $ 1 trillion in cloud spending. IVES seeks to provide investment results that, in terms of fees and expenses, generally correspond to the price and performance performance of the Dan Ives Global Cloud Technology Prime Index. IVES holds approximately 77 securities in its basket. It has an AUM of $ 30.1 million and an expense ratio of 0.68%.

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