Let me introduce to you first trust cloud computing etf. Now this etf has done fantastically over the last five years. Over the last five years. It’S done 27 per annum, and if you compare that against sap 500, you have an excess gain of close to 11 more per year. Now, today, i’ll be discussing first trust cloud. Community etf. I also try to explain to you. You know an overview about the cold cloud computing space. I also try to justify: will growth actually slow moving forward and as well as compare first trust cloud computing etf versus some of the other alternatives in the market and last but not least, also give you a quick learning point from what you can take away from Today’S tutorial so with that let’s roll it into a video hi guys welcome back now, let’s start by giving an overview of the whole cloud computing space. So if an expert do leave in the comments section, we can learn from you also for myself, i’m pretty layman. So i’m going to explain in terms of layman wise, so let me pull up a chart. This is actually a chart showing your top 10 advantages of clock. Computing i’ll touch on a few key points. Where i understand myself that i can relate myself and the first one starts with this. Less cost is quite obvious. With cloud computing, you don’t need your own server and point number three on the top right corner.

You see over there flexibility in capacity now i have a friend who’s working in a cloud computing firm and he’s. Actually i mean you know when traced together first came on board. They encouraged a lot of singapore’s to take up, trace together and download that app and, if i’m, not wrong from what i hear from him trace together actually had a crash. Something like that, because there’s so much excessive download the whole cloud computing part is. You can increase your capacity with just a click of a button that’s my understanding of things. I run the website myself, the s2 parent check it out show some love there. Also, i touch on some concepts on financial planning and what i’ve realized is when there are surges in traffic. It can cause the website to crash. So it could be a very viral article. It could be a deal or promotion and from i’m pushing. So if cloud computing, you actually increase and decrease the capacity you need in terms of your bandwidth. The third part that i understand myself is point number six security. You know in the previous video we’ve done before it’s mentioned that ransomware attacks are coming very frequently. Every six seconds, an enterprise software is, is being interfered with a ransomware, a malware, something like that and increasingly so. So, if you have your hosts, not by yourself but by aws or azure, who are the two leading players, you get a lot more security.

So these are real benefits of the whole cloud computing space, but a million dollar question which i can help you more as an investor, is: will growth in cloud computing slow down? Now, let me put some white paper that’s actually done by arc. They’Ve actually done a full explanation of this whole cloud, combing space, which i’ll leave links below just in case. You are keen to find a bit more for yourself. The first part that we need to understand is the demand from businesses and public seems to be moving upwards, as we digitize correct, but let’s pull on some graphs to explain things. This is the first thing that we need to understand, for ourselves is remote working going to be permanent moving forward, at least for myself? I think so, i’m very happy working from home right now previously, in my role as advisor, i have to go down to starbucks or customers office or customer’s home to do a presentation, but right now i do it through zoom. It saves everybody time so i think it’s a permanent shift for myself and this graph really explains things. Microsoft, team users shot up what about z, scalar cloud security, traffic, shot up and zoom meeting participants wow. This growth is phenomenal, so i’m part of that zoom revolution. I’M, pretty old school, so i only know how to use zoom so bother me for it. What we can see in this graph over here is that cost for cloud computing is certainly cheaper than hosting it yourself.

I checked with a friend of mine who works with a bank’s i.t. I think they are still holding the servers and stuff themselves rather than transiting to cloud, maybe because of security privacy. I don’t know, but i think a lot of old firms are still hosting it themselves and is very expensive, so this graph really shows it’s much cheaper, doing it to crop outsourcing it to them, and what has that translated to is translate to a much better growth Forecast for this whole industry on the right hand, side that’s, where arc invest, is actually projecting 21, compounded annual growth rate all the way to 2030.. Now, the conclusion we can all draw is growth in cloud computing is not slowing down any time. In fact, it can be argued that it’s still at the infancy stage, but that does not translate to share price share price, really do well in the next one year. Nobody knows so, hopefully we do dissociate. These two big picture, wise, is very rosy for the whole clock called building space so that’s. Why we’re moving on third part of doing discussion, which is using first trust cloud computing etf as an investment tool, or how does it fare against some of the other alternatives? In the market, let me introduce you this graph over here. What we can see is on the left. First trust cloud computing and there’s, actually global extra computing and wisdom tree cloud computing with tickers, clou and wcld respectively.

The dark, blue bar is actually first trust cloud computing, but the main part of this one year, graph that i’d like to highlight to you, is the sentiment for the space, is roughly the same all performance and then be or less doesn’t really make a difference. So pick any of the three i think that’s the main message they look roughly the same and if you’re on board with me on first trust cloud computing. Let me show you the 10 year history. You realize that i’ve mentioned that it’s outperformed smp it’s also outperformed nest deck over the last 10 years. The other two etfs cl ou and wcld have a much shorter track record that’s why i still prefer first trust cloud computing as an allocation. So with that let’s deep dive into this etf itself, we’ve actually done some homework. For you, as of 31st of march, the top holding was actually rackspace technology, followed by vmware and oracle corporation. But as of end of june, you realize that the holdings are very different. On top is mongodb, then second is microsoft, and third, amazon wow, so there’s, actually quite a bit of shuffling in terms of his top holdings. Let me plot also what is the top holding in clou and wcld in clou you realize that the top holding is actually z, scalar, followed by shopify and zoom for wcld, which is wisdom. Three cloud computing fund, utilizes box, incorporation as well as dropbox, so everybody’s top holding, is very different correct.

So if you flashback, what is the thought polling for? First trust cloud computing with the ticker skyy. You realize that mongodb, microsoft and amazon are totally different from the other two competitors, but why are these on the top of the list? Let me show you the methodology behind this etf itself. As mentioned, the index employs a modified equal weighted methodology. They give a score for iaas, which is infrastructure as a service paas, which is platform as a service as well as saas, which is software as a service, and, as you can see, is what it’s written there. Iaas and paas have a bigger weightage, they kind of favor that more over saas that’s. My simple layman, understanding of things, but again should we second doubt it, i think, also not so we are not experts. So we are not the wiser making a guess whether that is a good methodology or not. When we pick an etf, when we pick a fund, you go with what the methodology is. You go with the long term approach of things. I think that’s a much better way so with that out of the window, let me address the top holding for skyy, which is actually mongodb and before you get there. Let me invite you to smash that like button, because it’s taken our team hours to prepare this presentation for you. So hopefully it’s benefited you and again inviting you press on subscribe, because we’re launching ideas in the coming weeks on how you can actually improve your finances.

Now let’s look at mongodb, specifically i’m, not an expert in it. I’Ve mentioned that many times, but what i can do is i can actually call it information to present to you for you to make your own judgment, and this are actually clips from what is mentioned by mongodb’s ceo. So let me roll in that part, but as a big picture, mongodb is a competitor of oracle, so it does database management. So this is what ceo has to say incredibly powerful for developers, because they don’t have to make their applications accommodate the needs of the database anymore. So it means that they can adapt. Add a new data when they need to without worrying that a simple change is going to break everything. In addition to the document model, mongodb is fundamentally different from legacy databases that makes mongodb something called a distributed database and it allows mongodb to provide three features that developers and architects would otherwise have to build for themselves, saving the mass amounts of risk and work. So all sounds very rosy correct, but before we get too much further, let me balance the argument with some things: i’ve discovered reading articles as well as analyst reports, so what we can see is, while mongodb is on a favorable win building its revenue. Some have actually mentioned that using this chart that the declining revenue per customer is worrying, even though customer numbers are increasing in this blue bar over here. Maybe those are lower end customers, then the second part is some have mentioned direct sales.

They use direct sales almost extensively and that’s why sales and marketing is still going to be high and the third part is they still need to invest a lot in their platform, and that means that this firm is not likely going to be profitable, at least for The next few years, let me show you a graph for the profitability versus the revenue growth. This first graph over here shows that mongodb has incurred more and more losses in each and every year, moving forward in 2021 that’s the record number of losses. That is even with increase in revenue, so, as you can see in this second graph over here, you realize that 2021 was a record year for mongodb in terms of revenue. Having said that, what you realize in the yellow line over there is that the revenue growth seems to have stored or is on the declining trend, even though it’s still at a respectable 40 to 50 year on year growth, the revenue drop has really spooked investors that’s. Why mongodb share price has not performed two without hits of the recent moment and as you can see over here in the top 25 holdings for sky, you realize that mongodb has actually been a detractor in performance losing 19.3, but they’re, not the worst on this whole List of top holdings, you realize that the worst is actually fastly who has lost more than 45 percent. If you contrast that to the top performer lumen technologies, that has gained 50 percent, so one company has gained 50.

One company has lost 45. Does that mean that if you are not an expert in the whole cloud computing space isn’t it better to buy diversified rather than go stock? Picking you pick one and what, if it’s the minus 45, everybody hopes to get that plus 50. But if we are picking a loser, then actually we’re not benefiting from this whole revolution of cloud computing, so that’s, my third thing buy diversified on the portfolio wise. You naturally see appreciation if most of the names are doing well and let the portfolio’s methodology really revise what should be a top holding and look long term and, if you’d like to benefit more from the whole cloud. Computing revolution i’ve. Actually, this previous video that touches on capital, d seaweed and maple tree industrial trust – i don’t know if you’ve seen it before. Let me invite you there. If you haven’t, seen maple tree industrial trust has really acquired a lot of data centers in u.s. They are the ones making big moves and data centers are the infrastructure for this whole cloud computing revolution. Maybe it gives you more ideas whether the data’s on the reads are good part of your portfolio or not.