ETFS Morningstar Global Technology ETF
ASX Code: TECH
ETFS Morningstar Global Technology ETF (ASX Code: TECH) offers investors exposure to global technology companies encompassing hardware, software and IT services.
TECH aims to provide investors with a return that, before fees and expenses, tracks the performance of the Morningstar Developed Markets Technology Moat Focus Index. TECH uses a full-replication strategy to track the index, meaning that it holds all of the shares that make up the index closely in proportion to their index weights.
The index comprises of 25 to 50 global technology companies across areas such as software, semiconductors, data processing, computer equipment and databases. Companies are screened using Morningstar’s proprietary moat methodology, to include only those companies that are identified as possessing strong competitive advantages relative to their peers. Further, companies are selected for the index on the basis of how attractively they are priced relative to their fair value, as evaluated by Morningstar’s team of equity analysts.
The methodology employed by Morningstar in calculating the index can be found, here.
Why consider TECH
Simple, low-cost sector access to global technology.
Exposure to a sector that is underrepresented in the Australian domestic market.
Access to stock selection driven by Morningstar’s proprietary research.
TECH invests in the technology sector as defined by the Morningstar Global Category Classification, which includes companies that generate their revenue from hardware, software and IT services.
Investors should note that some high profile companies, like Amazon and Facebook, that have a heavy technology association to their products or services belong to other sectors because their revenue does not come directly from the sale or licensing of their technology. They are therefore not included in TECH.