Exchange-traded funds (ETFs) are some of the most interesting investments to look through in my opinion. The index funds variety, exemplified by the Vanguard Australian Shares Index ETF (ASX: VAS), are certainly the most popular. But many investors think index funds like VAS are a little 'vanilla'. Sure, they have important roles to play, and are great long-term investments. But there are some more exotic ETFs out there that do offer a bigger slice of pizazz, let's say. So here are 2 exotic ETFs that I think all investors should consider today.
2 exotic ETFs for an ASX share portfolio
BetaShares Global Cybersecurity ETF (ASX: HACK)
This ETF from BetaShares does what its name implies. It tracks a basket of global shares involved in the provision of cybersecurity. I really like this ETF because it comprehensively covers an area seeing strong growth, which I think will last for decades to come. Think about how important cybersecurity is today, for individuals, companies and governments. Then think about how important it will be into the future as more and more commerce, communications and government services are done online. I'm sure you've reached a similar conclusion than I have.
HACK is heavily weighted towards the United States, with 89% of its holdings listed in the US. However, Britain, Israel and Japan also feature. Some of HACK's top holdings include CrowdStrike, ZScaler, Okta and Cisco Systems. This ETF has returned an average performance of 21.04% over the past 3 years, which I think could well happen again over the next 3 and beyond.
ETFS FANG+ ETF (ASX: FANG)
This ETF is a highly concentrated fund tracking a basket of US shares known as the FANG+ stocks. FANG (sometimes FAANG) is an old acronym referring to Facebook Inc (NASDAQ: FB), Amazon.com Inc (NASDAQ: AMZN), Netflix Inc (NASDAQ: NFLX) and Google parent company Alphabet Inc (NASDAQ: GOOG)(NASDAQ: GOOGL). Apple Inc (NASDAQ: AAPL) is the other A in FAANG.
This ETF tracks all 5 of these US tech titans, plus another 5 extras. These include Tesla Inc (NASDAQ: TSLA), Twitter Inc (NASDAQ: TWTR) and Alibaba Group (NYSE: BABA) as well.
These are some of the best tech companies in the world, and I like that this ETF puts them all together in one easy investment. This ETF was only created in February this year, but since then it has already returned 54.7% (despite the March share market crash). If you want a strong, US-based and growth-orientated investment, then I don't think you need to look any further than FANG.
