Do you want to invest in technology in Mexico?
With a few exceptions, large Mexican companies are not characterized by being technology-based. And if it is about innovating, the situation becomes a little more depressing.
Despite being the second-largest economy in Latin America, no unicorn has yet emerged in Mexico, unlike other countries on the continent such as Colombia, Brazil, or Argentina. If you want to invest in technology companies in the country, you will have to look abroad.
Fortunately for these investors, there are more and more issuing companies in the International Quotation System (SIC) of the Mexican Stock Exchange (BMV). Most of the tech giants are already on this list, like Facebook (NASDAQ: FB), Google (NASDAQ: GOOGL), Tesla (NASDAQ: TSLA), or Netflix (NASDAQ: NFLX). Asian companies such as Alibabá (BABA N), or companies from France and Spain are also in the SIC.
These companies also offer the incentive to give advantages in the change from dollars to peso.
However, for some investors, the SIC may at some point be disappointing. The share prices of these companies are usually quite high, making a diversifying investment not so easy. A viable option for these investors has listed funds or ETFs.
What are ETFs (or listed funds)?
Listed funds or ETFs are mutual funds representing proportional ownership over an investment portfolio that replicates the index of a specific market. This allows investors to own a group of shares with a single purchase and a lower investment.
Case in point: QTEC tracks the NASDAQ Index of Top 100 Tech Companies. In other words, the investor who acquires this ETF is investing at the same time in the top 100 technology companies in the index, of which the top ten are:
- Facebook Inc.
- Citrix Systems Inc.
- Apple Inc.
- Microsoft Corp.
- Adobe Inc.
- Baidu Inc.
- Qualcomm Inc.
- Autodesk Inc.
- CDW Corp.
- Splunk Inc.
In this way, the investor more easily diversifies his capital and reduces the risk of loss.
However, for the novice, it can be a headache to identify all the ETFs available on the Mexican Stock Exchange. Although the characteristics of some stations can be intuited (it is not difficult to guess that BOTZ invests in companies related to robotics), others have darker names for the newcomer.
To save readers time looking for descriptions of different listed funds, here is an incomplete list of technology ETFs that people can find on the BMV.
Technology ETFs listed on the Mexican Stock Exchange
- BUG: With a name reminiscent of a programming error, these ETFs bring together companies focused on cybersecurity.
- EBIZ: If you had invested in this ETF earlier in the year, there would be no crisis for you. This ETF replicates the index of the main e-commerce companies.
- FINX: Fintechs promise to grow around the world and this investment fund bets on them entirely.
- HACK: a listed fund focused on cybersecurity.
- IHAK: This fund also sounds like security, it looks like a cybersecurity fund. But, investor, don’t be fooled: this is a cybersecurity fund.
- IXN: Fund dedicated to technology companies.
- IYW: The Internet would be nothing without the cables that link it. This fund is focused on the telecommunications companies that make this possible.
- KWEB: If you think Silicon Valley is a thing of the past, invest in this fund that focuses on Chinese companies.
- LIT: This fund is not strictly technology, but it will have a great impact on the sector in the coming years. This ETF tracks the performance of companies related to lithium, an indispensable material for making rechargeable batteries.
- PBW: We also need technology to combat global warming. This fund brings together clean energy companies.
- QTEC: This was one of the first Nasdaq ETFs. QTEC replicates the performance of the hundred best technology companies.
- RBOT
- STOLE
- ROBT: This ETF, like the previous two, focuses on robotics companies.
- SKYU:
- SKYY: These two funds are made up of cloud computing companies.
- SOCL: What do Facebook, Twitter, and Snapchat have in common? That all those companies are listed in this listed fund focused on social networks.
- SNSR: There’s a lot of hot news that says the Internet of Things (IoT) will be the next disruptive technology in the world. You can get ahead by getting this ETF focused on the sector.
- SOXL: This is a level semiconductor bottom. Returns the performance of the index three times. These types of funds, like their inverse, can be very dangerous. Don’t keep it for long.
- TAN: This is an investment fund focused on solar energy companies.
- TECX: TECL and TECS are the level fund and the inverse of companies in the technology sector.
- UBOT: Direction ETF of robotics and artificial technology.
- XSD: Another fund of semiconductor companies.
- XT: Fund focused on technology companies with exponential growth.
- XWEB: ETF focused on Internet companies.