PRESS RELEASE | FOR IMMEDIATE RELEASE
Consumer demand and business continuity benefit specialist firms
June 2020, London—The first half of 2020 has brought significant rewards for investors in technology funds and the outlook for post-COVID-19 looks bright for these investments, according to the latest issue of The Cerulli Edge―European Monthly Product Trends.
In contrast to broad equity indices such as the MSCI World and S&P 500—which are down slightly for the year as of June 10, according to FE Analytics—tech sectors have recorded significant gains. The S&P 500’s IT sector is up 14% and the MSCI World’s equivalent subset has gained 12.7%. Investors who bought into the S&P 500 five years ago have experienced a gain of 93.3% and those focusing on technology are up by 216.6%.
In the longer term, the technology sector could be a major winner from the economic recovery post-COVID-19, notes Cerulli Associates.
“An increase in home working has already benefited companies specializing in security software and cloud-based infrastructure and the longer the coronavirus pandemic lasts, the more these services will be relied upon. Such companies are expected to play a key role in business continuity planning,” says Fabrizio Zumbo, associate director, European asset management research at Cerulli.
Several exchange-traded funds (ETFs) tracking specialist indices focused on cybersecurity and digital infrastructure that have come to market in the past three years have been gathering fresh assets since the beginning of the COVID pandemic.
In addition, the advent of 5G mobile technology promises a boost for digital infrastructure and telecom companies. The development of 5G is not only a strong investment trend in itself, but could also boost tech companies that use mobile data, such as media-services providers.
NOTES TO EDITORS:
These findings and more are from The Cerulli Edge―European Monthly Product Trends, June 2020 issue.
Looking for more information? Contact Us.