What Dominates HACK’s Index
The universe of companies in the ETFMG Prime Cyber Security ETF’s (HACK) underlying index is based on research conducted by the index provider. The companies involved in cybersecurity architecture and application are screened for inclusion in the index based on criteria including a minimum market capitalization of $100 million, ample liquidity, and an operating company structure.
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Dominance of small-cap companies
Since HACK focuses mainly on cybersecurity, its constituents are dominated by mid- and small-cap companies with concentrations in software and IT (information technology) services (90.7%), followed by communications and networking (~7.4%), and aerospace and defense (~1.5%).
As of August 29, 2017, the index had 39 constituents, 12 of which are foreign companies. Around 87.7% of these constituent companies are from the mid-, small-, and micro-cap segments.
The top five stocks in the index include Cisco Systems (CSCO) at a weight of ~4.7%, Palo Alto Networks (PANW) at ~4.4%, Symantec (SYMC) at 4.3%, Splunk (SPLK) at ~4.0%, and Juniper Networks (JNPR) at ~3.8%.