The ETFMG Prime Cyber Security ETF (HACK) is an open-ended fund with assets under management of $1.1 billion. The fund has a median tracking difference of -0.73%. (Tracking difference refers to the gap between the performance of a fund and its underlying index.)
Usually, ETFs trail their underlying indexes because a number of factors prevent them from perfectly imitating the index. As a result, a tracking error is more about the extent of variability than about performance. The investment adviser of HACK expects that, over time, the correlation between HACK’s performance and its index, before fees and expenses, will exceed 95%.
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HACK charges 0.60% of the investment value as an annual fund operating expense, which is also referred to as an expense ratio. The expense ratio is one of the best indicators of ETF’s tracking difference because, if everything else is equal, ETF returns will likely lag behind the underlying index returns exactly by the amount of the expense ratio.
HACK is a unique ETF
HACK is a unique ETF in the global ETF industry because it provides investors with a cost-efficient way to access companies (CSCO) (JNPR) in the dynamic and evolving cybersecurity industry (SYMC) (SPLK). The fund’s portfolio offers convenient diversification across market capitalizations, geographies, and business focuses. As an exchange traded fund, HACK offers portfolio transparency and ample liquidity with high daily volume and narrow spreads.