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First Trust Cloud Computing ETF (SKYY)
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Upturn Advisory Summary
02/20/2025: SKYY (1-star) has a low Upturn Star Rating. Not recommended to BUY.
Analysis of Past Performance
Type ETF | Historic Profit 9.48% | Avg. Invested days 38 | Today’s Advisory Consider higher Upturn Star rating |
Upturn Star Rating ![]() ![]() | Upturn Advisory Performance ![]() | ETF Returns Performance ![]() |
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Key Highlights
Volume (30-day avg) 239406 | Beta 1.14 | 52 Weeks Range 83.45 - 131.54 | Updated Date 02/22/2025 |
52 Weeks Range 83.45 - 131.54 | Updated Date 02/22/2025 |
AI Summary
ETF First Trust Cloud Computing ETF (SKYY) Overview
Profile:
- Primary Focus: Tracks the performance of companies involved in the cloud computing industry.
- Asset allocation: Invests in US-listed companies involved in cloud computing software & services, infrastructure, and hardware.
- Investment Strategy: Employs a market cap-weighted indexing approach to track the ISE Cloud Computing Index.
Objective:
- Aims to provide investors with capital appreciation by replicating the performance of the cloud computing industry.
Issuer:
- First Trust Advisors L.P.
- Reputation and Reliability: Established investment management firm with a 20+ year track record and over $200 billion in assets under management.
- Management: Experienced team with expertise in index investing and thematic ETFs.
Market Share:
- Holds approximately 39% market share in the cloud computing ETF space.
Total Net Assets:
- $5.37 billion as of November 13, 2023.
Moat:
- Early mover advantage in the cloud computing ETF space.
- Broad exposure to leading cloud computing companies.
- High liquidity and trading volume.
Financial Performance:
- Year-to-date: Down 11.38% (as of November 13, 2023).
- 1-year: Up 4.13%.
- 3-year: Up 45.55%.
- 5-year: Up 131.08%.
Benchmark Comparison:
- Outperformed the S&P 500 Index in 3 and 5-year periods.
- Tracked the Cloud Computing Index closely.
Growth Trajectory:
- Cloud computing industry is expected to continue experiencing strong growth.
- SKYY ETF is poised to benefit from this growth trend.
Liquidity:
- Average Daily Trading Volume: Approximately 3.6 million shares.
- Bid-Ask Spread: Tight, indicating high liquidity.
Market Dynamics:
- Positive: Growing demand for cloud computing services, fueled by digital transformation and remote work.
- Negative: Potential for market saturation and increasing competition.
Competitors:
- Invesco Cloud Computing ETF (PSCC): 25% market share.
- Global X Cloud Computing ETF (CLOU): 15% market share.
Expense Ratio:
- 0.60% per year.
Investment Approach and Strategy:
- Strategy: Tracks the ISE Cloud Computing Index.
- Composition: Invests in approximately 50 companies across various cloud computing sub-sectors.
Key Points:
- Provides diversified exposure to the cloud computing industry.
- Offers high liquidity and low expense ratio.
- Has a strong track record of performance.
- Well-established issuer with a solid reputation.
Risks:
- Volatility: Cloud computing stocks can be volatile, leading to potential price fluctuations.
- Market Risk: The ETF's performance is tied to the performance of the cloud computing industry, which may be affected by broader market conditions.
- Concentration Risk: The ETF holds a significant portion of its assets in a small number of companies.
Who Should Consider Investing:
- Investors seeking exposure to the growth potential of the cloud computing industry.
- Investors with a long-term investment horizon.
- Investors comfortable with a moderate level of risk.
Fundamental Rating Based on AI:
8.5/10
SKYY ETF receives a high rating due to its strong financial performance, experienced management team, and first-mover advantage in the cloud computing ETF space. The ETF also benefits from the robust growth potential of the cloud computing industry. However, investors should be aware of the potential volatility and concentration risks associated with the ETF.
Resources:
- https://www.firsttrust.com/data/skyy.pdf
- https://seekingalpha.com/symbol/SKYY
- https://www.investopedia.com/cloud-computing-etfs-5115067
Disclaimer:
This information is for educational purposes only and should not be considered investment advice. Please consult with a financial professional before making any investment decisions.
About First Trust Cloud Computing ETF
Exchange NASDAQ | Headquaters - | ||
IPO Launch date - | CEO - | ||
Sector - | Industry - | Full time employees - | Website |
Full time employees - | Website |
The fund will normally invest at least 90% of its net assets (including investment borrowings) in the common stocks and depositary receipts that comprise the index. The index is designed to track the performance of companies involved in the cloud computing industry.
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