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Why Software ETFs are Soaring

Neena Mishra
The deployment of 1-gigabit wireline networks, wireless/wireline converged networks and an increase in core market share are likely to aid Dycom's (DY) fiscal Q3 results. However, under-absorption of labor and field costs is a cause of concern.

 

Technology continues to be one of the best performing sectors this year, up about 17%. Some areas within technology have done much better. Software & services industry is one of them. ETFs tracking the industry are up more than 30% this year.

In 2011, Marc Andreessen, co-founder of the venture capital firm Andreessen-Horowitz, wrote the famous essay--“Why Software Is Eating The World”--which was published in the Wall Street Journal.

“We believe that many of the prominent new Internet companies are building real, high-growth, high-margin, highly defensible businesses.”

 “We are in the middle of a dramatic and broad technological and economic shift in which software companies are poised to take over large swathes of the economy.”

The trend continues to accelerate. Software is still eating the world!

Global corporate spending on software and services is projected to increase by 6.2% in 2018, the highest annual growth rate forecasted since 2007, per IDC.  

According to State Street, “more companies in the software & services industry posted positive earnings surprises and have beat expectations by a larger margin every quarter over the last three years.The industry is expected to continue posting double-digit growth this year and surpass the broader market in 2019.”

To learn  more about the iShares North American Tech-Software ETF (IGV), the Invesco Dynamic Software ETF (PSJ) and the SPDR S&P Software & Services ETF (XSW), please watch the short video above.

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Salesforce.com Inc (CRM) : Free Stock Analysis Report
 
Adobe Systems Incorporated (ADBE) : Free Stock Analysis Report
 
Microsoft Corporation (MSFT) : Free Stock Analysis Report
 
SPDR-SP SOF&SER (XSW): ETF Research Reports
 
ISHARS-NA TEC-S (IGV): ETF Research Reports
 
PWRSH-DYN SFTWR (PSJ): ETF Research Reports
 
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