The Internet of Things (IoT) has received a lot of attention over the past few years, thanks mainly to the growing appetite for connectivity. What is the Internet of Things? In simple words, IoT links the physical and the digital worlds. So, it could be an ecosystem of devices which have chips and are connected to the internet, enabling them to capture and transmit data constantly and giving them the ability to communicate.
Why invest in the Internet of Things? This is an area that will likely see massive growth in the coming years. Cisco (CSCO – Analyst Report) estimates IoT will consist of 50 billion devices connected to the internet by 2020. Per a McKinsey report, IoT could generate up to $11.1 trillion in economic value per year by 2025.
Most investors have probably heard about how this technology can be applied to smart homes, where household appliances are controlled by your smartphone, or your bed could turn on your coffee maker and the heating system in your car.
But this technology could bring about profound changes in other settings like factories, where sensors could be used to optimize the maintenance of equipment and protect the safety of workers, or in cities for delivery of efficient services. In human bodies, devices and wearables could monitor health and wellness on an ongoing basis and detect life-threatening symptoms early.
The Global X Internet of Things Thematic ETF is the first ETF to target this theme. The product holds companies that could benefit from the broader adoption of this technology. The underlying index follows a modified market weighting scheme, with a single security cap of 6%.
A single security weight cap of 2% is applied to companies with diversified revenue streams.
To learn more, please watch the short video below:
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