As the world’s first cyber-security we were curious to investigate the PureFunds ISE Cyber Security ETF (NYSEARCA:HACK) that tracks the ISE Cyber Security Index (HXR).

Designed to deliver competitive returns, the overall asset classes of 30 securities included in the HACK ETF are approximately two-thirds software and programming and double digit allocation of communication equipment and mobile Internet devices.

GPS

Internationally, US based cyber-security firms lead at 72% over Israel (12%), Netherlands (5%), South Korea (5%), Japan (4%), Finland (2%), and Canada (1%) according to the Zack Funds report.

Clearly, publicly traded cyber-security firms that produce security solutions software against attacks on Internet of Things (IoT) devices are fast becoming highly sought after earners since the governments initiative to be proactive on legislation combating cyber-attacks.

Back in February 2014, bolstered by strong earnings and when President Obama pressed for new legislative initiatives to crack down IoT espionage,  the “cash on the barrel-head” stock CyberArk Software (NASDAQ:CYBR) skyrocketed.

CYBR was already showing an upward trajectory based on their quarterly net income at five times the previous fourth quarter in 2013 of $1.4 million.  Then it surged to a 52-week high of $72.48 in February before settling down to establish a new price strata in March around $50 per share.

HACK IT IF YOU CAN

The HACK’S three month performance on Market Value was 12.67%, rising to 15.54% this past month.  The top three holdings are Infoblox (NYSE:BLOX); CyberArk Software LTD (NASDAQ:CYBR) with 5.24% in total net assets, Fireeye, Inc. (NYSE:FEYE) with 5.19% and ProofPoint, Inc. (NYSE:PFPT) 5.16% in total net assets. As well, Palo Alto Networks, Inc (NASDAQ:PANW) and Qualys, Inc. (NASDAQ:QLYS).

Our volatility generator forecasts a 96.88% probability that HACK will hit $30.00 per share within the next 60 days.  Last Friday’s close was $27.84. Right now the price level is position near the 50% Fibonacci Ratio – showing a consolidation that precedes a breakout.

On March 26, HACK traded at an unusually high “buy” volume, a signal to us that its going into a 7-day Bullish trend.  This gives us confidence that an upward trend is in the making.  Listed below are all 30 assets in the HACK and their last “weights” performance (3/27/2015). Source: ISE Cyber Security Index.

FUTURE IPOS TO WATCH FOR

Taking a lead from the projected increase in global security spending from $71.1 billion (2014) to $76.9 billion in 2015, three more cyber-security firms have announced that they are going public. Collectively, analysts are estimating a $1 billion or higher purchase total.  The firms are Rapid 7, LogRhythm and Veracode.

IoT OFFENSIVE – 25% GAINS BY YEARS END

As deals flow to upgrade the cyber-security cycle in enterprising innovations coming on the market, coupled with the government’s “bullet train fast track” to take on the offensive against IoTs plaguing  American business and individuals, it is predicted that Wall Street traded cyber-security solutions sector’s profitability will be reach 25% or more by the end of this year.

HACK ETF – BASKET OF ASSETS

Symbol Weights Company Name
PANW.N 4.69 Palo Alto Networks Inc.
SAIC.N 4.08 Science Applications International Corp
FTNT.OQ 4.65 Fortinet Inc
PFPT.OQ 4.82 Proofpoint Inc.
CUDA.N 3.96 Barracuda Networks Inc
RDWR.OQ 3.54 Radware Ltd
FEYE.OQ 5.17 FireEye Inc
SPLK.OQ 4.1 Splunk Inc.
QLYS.OQ 4.59 Qualys Inc.
BLOX.N 5.25 Infoblox Inc
IMPV.N 3.17 Imperva Inc
MANT.OQ 0.8 Mantech Intl Corp A
XLS.N 0.99 Exelis Inc.
SYMC.OQ 3.5 Symantec Corp
CHKP.OQ 4.06 Check Point Software (US)
CSCO.OQ 3.82 Cisco Systems Inc
ZIXI.OQ 0.77 Zix Corp.
GUID.OQ 0.6 GUIDANCE SOFTWRE
FSC1V.H 2.55 F-Secure Oyj
JNPR.N 4 Juniper Networks Inc
CMP.WA 0.2 Comp SA
ABT.TO 0.78 Absolute Software Corp
GTO.AS 0.69 Gemalto NV
AVG.N 4.29 AVG Technologies NV
WYY.A 0.68 Widepoint Corp
IL.N 3.74 IntraLinks Holdings Inc
053800. 4.73 Ahnlab Inc
KEYW.OQ 3.17 Keyw Holding Corp
CYBR.OQ 5.2 Cyber-Ark Software Ltd/Israel
VDSI.OQ 3.16 VASCO Data Security Intl Inc
4704.T 4.26 Trend Micro Inc
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One thought on “HACK – THE ISE CYBER SECURITY INDEX TRACKER ON IOTS

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