If you’re wanting to add some diversification to your portfolio in 2021, then you might want to look at exchange traded funds (ETFs).
ETFs are a great way to achieve this because they give investors easy access to a large and diverse number of different shares through a single investment.
With that in mind, listed below are two ETFs which are highly rated. Here’s what you need to know about them:
BetaShares Global Cybersecurity ETF (ASX: HACK)
The BetaShares Global Cybersecurity ETF aims to track the performance of an index providing investors with exposure to the leading companies in the growing global cybersecurity sector.
With cybercrime on the rise, demand for cybersecurity services is expected to increase strongly in the future. And given how this side of the market is heavily under-represented on the ASX at present, BetaShares believes this ETF give investors an easy way to invest in the sector.
Included in the fund are both global cybersecurity giants and emerging players from a range of global locations. Among its holdings you’ll find Accenture, Cisco, Cloudflare, Crowdstrike, and Okta.
In respect to the latter, Okta provides large enterprises with workforce identity solutions. Its customer identity and access management (CIAM) solutions ensure an organisation’s remote workforce is who they claim to be and that they only have access to the business applications they need to perform their job.
Demand for its offering has been growing rapidly over the 12 months as more and more people work from home.
VanEck Vectors Morningstar Wide Moat ETF (ASX: MOAT)
Another ETF to look at is the VanEck Vectors Morningstar Wide Moat ETF. This fund gives investors a slice of 48 US-based stocks which are judged to have sustainable competitive advantages or “moats”.
Historically, companies with moats have generated strong returns for investors. This is why investing in companies with moats is a key investment tenet for Warren Buffett.
Among the ETF’s holdings you will find global blue chips such as Amazon, American Express, Boeing, Coca-Cola, Microsoft, Pfizer, and Yum! Brands. Over the last 10 years the ETF has outperformed the ASX 200 index materially with an average total return of 18% per annum.
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More reading
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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of BETA CYBER ETF UNITS. The Motley Fool Australia has recommended VanEck Vectors Morningstar Wide Moat ETF. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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