Some exchange-traded funds (ETFs) are producing solid long-term growth returns.
Not every ETF has produced an average annual return that’s in the double digits. Some are focused on dividends. Others just don’t have businesses with growth that have produced that type of return.
But these two ETFs have done well in recent years:
Betashares Global Cybersecurity ETF (ASX: HACK)
This investment is about giving investors exposure to many of the world’s leading cybersecurity businesses.
Cybercrime is on the rise and cybersecurity services are expected to continue to grow in demand for years to come.
With a total of 40 holdings, the Betashares Global Cybersecurity ETF gives exposure to both global giants and emerging players. Its top 10 holdings include Cisco Systems, Accenture, Crowdstrike, Splunk, Zscaler, Proofpoint, Fortinet, Akamai Technologies, VMWare and Leidos. The portfolio is quite heavily weighted towards the US with a 90% allocation.
In 2021, the global cybersecurity market is expected to be worth US$202.97 billion. It’s expected to grow to US$248.26 billion by 2023.
The annual cost to get exposure to this portfolio of cybersecurity businesses is 0.67%. The ETF has net assets of $453.6 million, so it’s one of the bigger options on the ASX. It has produced average net returns of 19.5% per annum since inception in August 2016.
Betashares Nasdaq 100 ETF (ASX: NDQ)
This investment gives investors exposure to the 100 largest non-financial businesses listed on the NASDAQ.
It’s a who’s who list of many of the world’s industry leaders in their respective categories.
Of course, there are the tech companies like Apple, Microsoft, Amazon, Alphabet, Facebook, Tesla, Nvidia and PayPal in there.
But many investors will have heard of other global leaders such as Adobe, Cisco Systems, Netflix, PepsiCo, Costco, Qualcomm, Starbucks, Intuit, Intuitive Surgical, Advanced Micro Devices, Mondelez International, Activision Blizzard, Zoom and Moderna.
It’s a high quality portfolio with a strong tech focus, which is where a lot of the revenue growth and share price growth has been over the last year and the last decade.
The annual management fee of Betashares Nasdaq 100 ETF is 0.48% per annum.
US tech shares have performed strongly over the last five years, which has led to this ETF being a good performer as well. Over the last five years to 30 April 2021, it has produced net returns of an average of 26.3% per annum. Since inception in May 2015, the net return per annum has been an average of 21.6%.
The underlying businesses continue to launch new services and improve existing offerings which raises the possibility of delivering good profit growth and outperformance of the ASX.