ETF v praxi
CYBR (Cybersecurity): ETF Review — Holdings, TER and Who It's For
Key takeaways
- CYBR tracks the Nasdaq CTA Cybersecurity Index — approximately 50 cybersecurity companies worldwide.
- Cybersecurity is a structural megatrend: spending grows regardless of the economic cycle.
- The approximate TER is around 0.75% per year; always verify the exact figure on justETF.
- Despite the defensive theme, CYBR is volatile — most holdings are growth-oriented companies with high valuations.
- Suitable as a thematic satellite for investors who believe in the inevitable growth of cybersecurity spending.
CYBR combines a defensive theme — cybersecurity is a necessity, not a luxury — with the growth profile of the companies delivering it. The L&G fund tracks the Nasdaq CTA Cybersecurity Index and holds approximately 50 companies in data protection, network security, cloud security, and identity management. Among them are Palo Alto Networks, CrowdStrike, Fortinet, Zscaler, and other sector leaders.
What the Nasdaq CTA Cybersecurity Index tracks
The index includes companies that primarily generate revenue from cybersecurity or are key players in the sector. Geographically, the US dominates (over 75%), with smaller weightings in Israel (historically a strong cybersecurity hub), Japan, and the UK. The fund is relatively concentrated — 50 companies versus hundreds in broad-market ETFs — which increases stock-specific risk.
Why cybersecurity spending grows structurally
Digitisation, cloud migration, AI systems, and geopolitical tensions are driving demand for cybersecurity regardless of the economic cycle. Companies and governments cannot simply defer security spending — the risk of a breach is too high. This structural demand makes cybersecurity an attractive thematic segment.
Costs and fund structure
The approximate TER is around 0.75% per year. CYBR is an Irish accumulating UCITS ETF traded in USD and euros. The higher TER compared with broad-market funds is typical for narrowly focused thematic ETFs.
Who CYBR is suitable for
- A satellite position (3–10% of the portfolio) for investors with conviction in digital security.
- As a complement to an IT sector ETF — cybersecurity is a sub-segment with distinct characteristics.
- For investors who believe in growing regulatory requirements around cybersecurity.
- Not suitable as a core portfolio holding — for that, see how to build a portfolio.
For a comparison with other thematic ETFs, visit the ETF overview.
FAQ
Why is CYBR volatile if cybersecurity is a "necessity"?
A defensive business model does not mean defensive equities. Companies in CYBR are typically fast-growing with high valuations (P/E or P/S ratios). Growth stocks are very sensitive to interest rates — when rates rise, their future earnings are discounted more heavily.
Is CYBR a suitable substitute for an IT ETF?
No — they offer different exposures. An IT ETF (such as IUIT) covers the entire information technology sector: hardware, software, semiconductors. CYBR is a sub-segment focused purely on cybersecurity. They can complement each other, but are not interchangeable.
Where else can I invest in cybersecurity?
Beyond CYBR, there are alternatives such as HACK (ETFMG Prime Cyber Security) and BUG (First Trust NASDAQ CEA Cybersecurity). They differ in index, composition, and TER. Always compare on justETF before deciding.