DISRUPTIVE SECTORS, CONTEMPORY PORTFOLIOS
When Amazon went public in 1997, few investors could have imagined that the online bookseller would almost single-handedly rewrite the rules of retail. Likewise, nobody could have predicted how profoundly Netflix would change entertainment, or how mobile would change communication, media and transportation.
To be sure, disruptive ideas can pave the way for exponential change – and opportunity. While it may be impossible to identify the next Amazon, it is possible for investors to take tactical positions in technologies and trends that are transforming how we live and work.
More than style boxes and market cycles
Disruptive investing isn’t constrained by traditional investment parameters, such as company size, region or sector. Instead, it focuses on identifying long-term secular changes, and then pinpointing the companies best positioned to drive change or benefit from it.
With any emerging area, it can be difficult to spot winners and losers. But by investing in Defiance ETFs, investors can gain precise exposure to a specific disruptive theme, while sidestepping the idiosyncratic risk of a single company.
In the same vein, whereas market-cap weighted indexes tilt heavily toward companies that are already established, Defiance ETFs focuses on equally-weighted indexes. This gives investors key exposure to smaller companies with significantly more potential for growth.
Separating the signal from the noise
Augmented and virtual reality are indicative of this category. While these technologies are often associated with gaming and entertainment, developments in this space have major implications for the real world. To be sure, AR and VR promise to impact everything from industrial design and commerce, to communication and healthcare. The applications of these and other truly disruptive technologies are bounded only by our imagination.
Participating in disruption shouldn’t be relegated to a narrow group of institutional investors trying to pick winning companies. Defiance ETFs makes investing in the technology and trends that will shape our future more possible, more accessible and more affordable.
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