First Trust Cloud Computing ETF

SKYY

Market cap $3.18B

The First Trust Cloud Computing ETF (SKYY) made its debut on 05/27/2011, and is a smart beta exchange traded fund that provides broad exposure to the Technology ETFs category of the market.

After holding steady for much of 2025, the U.S. Federal Reserve finally instituted the first rate cut of 25 basis points, which could help jumpstart more mergers and acquisitions (M&A) activity. Likewise, this and further rate cuts could benefit exchange traded funds (ETFs) that provide exposure to M&A dealmaking.

The First Trust Cloud Computing ETF (SKYY) was launched on May 27, 2011, and is a passively managed exchange traded fund designed to offer broad exposure to the Technology - Cloud Computing segment of the equity market.

First Trust Cloud Computing ETF offers a balanced cloud computing exposure, blending mega caps and growth names, making it a solid Buy within the competitive tech ETF landscape. The ETF's unique weighting methodology ensures diversification and avoids excessive concentration while still capturing key players like Amazon and Alphabet. Historical performance shows SKYY lags broader tech ETFs in downturns but is poised to benefit from future growth cycles, especially with embedded AI optionality.

I rate SKYY a hold due to its strong cloud/A.I. growth prospects but high valuations make me cautious about buying now. SKYY is well-positioned with large-cap cloud leaders and benefits from digital transformation, but its top holdings concentration adds risk. The fund outperforms peers and should deliver double-digit growth, but high multiples mean volatility and sensitivity to interest rates.

Launched on 05/27/2011, the First Trust Cloud Computing ETF (SKYY) is a smart beta exchange traded fund offering broad exposure to the Technology ETFs category of the market.

The First Trust Cloud Computing ETF (SKYY) was launched on 05/27/2011, and is a passively managed exchange traded fund designed to offer broad exposure to the Technology - Cloud Computing segment of the equity market.

Launched on 05/27/2011, the First Trust Cloud Computing ETF (SKYY) is a smart beta exchange traded fund offering broad exposure to the Technology ETFs category of the market.

Cloud computing is rapidly expanding, with only 30% of workloads migrated and a projected 22% CAGR through 2030, making the sector highly attractive. I favor SKYY ETF for long-term investors due to its superior historical performance, strong liquidity, and balanced exposure to cloud market leaders and tech giants. SKYY's emphasis on mega-cap tech firms like MSFT, AMZN, and GOOGL provides diversification, lower volatility, and a safer investment profile than pure-play cloud ETFs.

Designed to provide broad exposure to the Technology - Cloud Computing segment of the equity market, the First Trust Cloud Computing ETF (SKYY) is a passively managed exchange traded fund launched on 05/27/2011.