Historically speaking, the markets do well in US election years. While each political side favors different industries that can see big boosts
after the election, a few sectors stand to gain on the lead-up alone.
In the era of fake news and political interference, the buzz this year is around cybersecurity. Social media sites and intelligence officials have both reported increased hacking and tampering activity specifically pertaining to the 2020 US Presidential Election, and as the stage shifts from party nomination to general election, we can expect a significant ramp up. An increasingly viable weapon in the online information battles has become social media bots and accounts that seem legitimate, often coming at the expense of someone’s hacked accounts.
At the same time, reports of company databases being hacked and divulging personal and private information have continued to occur since the 2017 Equifax data breach. With each report, the suffering company gets lambasted for not investing properly in cybersecurity, and other companies rush to ensure their needs are met.
That’s why cybersecurity stocks have been largely on the rise over the last year. With the COVID 19 coronavirus bringing stocks down around the globe, now’s a good chance to take a look at some of the cybersecurity offerings for investors on the market.
Cybersecurity ETFs
(Six-month price chart for First Trust NASDAQ CEA Cybersecurity ETF)
Why bet on one horse when you can bet on the whole field? Cybersecurity ETFs like the
Evolve Cyber Security Index Fund (
TSX:CYBR) have performed well over the last year, and the benefit of being diversified into different fragments of cybersecurity offers one of the best ways to take advantage of a 2020 election upswing benefitting some players over others. Other ETFs include
First Trust NASDAQ Cybersecurity ETF (
NASDAQ:CIBR) and
ETFMG Prime Cyber Security (
NYSEArca:HACK)
Cybersecurity Mid-Caps
(Six-month price chart for Qualys)
Cybersecurity is a growing field, but it’s not exactly a new one. Many companies in the field have achieved multibillion-dollar market caps, including “smaller” names like
Qualys Inc. (
NASDAQ:QLYS) and well-known players like
Fortinet Inc. (
NASDAQ:FTNT), by targeting the right sectors or companies, as the amount of specific cybersecurity needs rises with each new wave of technological adoption. Other companies include
CyberArk Software Ltd. (
NASDAQ:CYBR),
FireEye Inc. (
NASDAQ:FEYE), and
CrowdStrike Holdings Inc. (
NASDAQ:CRWD)
Canadian Cybersecurity Small-Caps
(Six-month price chart for VirtualArmour International)
If the reports of increased cybercrime activity and the rise in billion-dollar company valuations adds up to anything, it’s that the market has plenty of room to grow. Small-cap cybersecurity ventures include
Absolute Software Corp. (
TSX-ABT) amongst a handful of providers that are serving both niche and general cybersecurity markets with plenty of upside potential. Other companies include
VirtualArmour International Inc. (
CSE:VAI) and
Quantum Numbers Corp. (
TSX-V:QNC).
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