Market Overview

Putting On The Wearable Technology ETF

Putting On The Wearable Technology ETF

Investors and consumers hear plenty about the wearable technology phenomenon. An easy way to tap the growth in wearable technology, and that growth is expected to be significant, is with the WEAR ETF (BATS: WEAR), which debuted in December.

WEAR tracks the Wearables Index, a benchmark developed by EQM Indexes. Exchange Traded Concepts, LLC (ETC) and Eve Capital partnered to launch the new ETF.

What's Up With WEAR?

WEAR's index is designed “to track global companies that have a current or future business focus on wearable technology products and/or components,” according to EQM Indexes. That index “seeks to track the combined performance of a basket of global stocks that derive revenue from the sale of wearable technology devices (electronics that can be worn on the body either as an accessory or as part of clothing) for applications such as: Sports and Fitness, Industrial/Military, Infotainment/Lifestyle, and/or Healthcare and Medical OR derives revenue from the manufacturing of components used in wearable devices such as semiconductors, sensors, and displays.”

Hyper-Focused ETF WEAR

While WEAR fits the bill as a hyper-focused ETF, there is no denying the massive growth ahead of the wearable technology industry.

“CCS Insight has updated its outlook on the future of wearable tech, indicating that 411 million smart wearable devices, worth a staggering $34 billion, will be sold in 2020,” according to Forbes.

“Wearables are expected to be a $19-billion industry by 2018, according to Juniper Research. Products including Fitbit fitness trackers, Android Wear watches, and the Apple Watch have helped fuel a rise in mainstream awareness of wearable’s [sic] for the past several years,” according to Eve Capital.

WEAR returned more than 9 percent in the first quarter. Smart watches are expected to be big drivers of wearables growth.

"Though the sales of smartwatches are the one of the strongest types of wearables, their adoption will remain much below sales of smartphones. For example, in 2016 more than 374 million smartphones will sell in mature market countries and in large urban areas of emerging market countries, for example, in Hong Kong and Singapore," according to Gartner.

Related Links:

How Did Wearables Do In Q4?

Fitbit's New All-Time Low Coincides With Warren Buffett's Entrance In The Wearables Sector


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