President Trump and the White House are continuing their efforts to tweak a cyber security executive order. Now, Trump has made it a priority to protect federal networks and data, in addition to infrastructure. In fact, we recently saw WikiLeaks dump data that appeared to be Central Intelligence Agency (CIA) documents that showed its spying operations and hacking tools. The dump was codenamed Vault 7, which contained over 8,000 documents. That in mind, WikiLeaks claimed it represented CIA’s hacking tools.
According to TrustedSec CEO David Kennedy, who previously worked with the NSA and the Marine Corps’ signals intelligence unit (SIU), “From what I can tell, this seems to be legitimate…It shows expansive capabilities of the CIA and divulges NSA tools as well. But a lot of it seems to be missing, as far as direct codebase used for these.”
Cyber Security ETF in Focus
Trader and mentor Jason Bond stated, “We’ve seen one cyber security ETF start rising already, and volume has been increasing in the name. The PureFunds ISE Cyber Security ETF could rise after Trump’s budget proposal. Moreover, we could potentially see some government contracts awarded to publicly-traded companies, which should cause HACK to rise.”
The PureFunds ISE Cyber Security ETF (NYSEARCA: HACK) is the world’s first cyber security ETF, and aims to provide exposure to the ISE Cyber Security Index. The fund primarily holds companies offering software, consulting and services, and hardware to defend networks and people against cyberattacks. As of March 17, 2017, HACK was up over 10% year to date, and over 25% over the past year. With these new developments in the industry, this is one Trump trade that should not go unnoticed.
White House Looking to Beef Up Cyber Security
Moving back to the overall theme, the budget proposal indicated the request for an increased budget “begins to rebuild the U.S. armed forces by addressing pressing shortfalls, such as insufficient stocks of critical munitions, personnel gaps, deferred maintenance and modernization, cyber vulnerabilities, and degraded facilities…As the world has become more dangerous—through the rise of advanced potential adversaries, the spread of destructive technology, and the expansion of terrorism—our military has gotten smaller and its technological edge has eroded.”
White House Homeland Security and Counterterrorism Advisor Tom Bossert stated, “We will be looking for achievable ideas to that end…Federal networks can no longer sustain themselves.” Bossert added, “We cannot tolerate indefensible technology, antiquated technology, hardware and software. Modernization is absolutely critical.”
This might have pushed White House officials to realize America is vulnerable, prompting Trump to increase funding for the Department of Homeland Security. In President Trump’s budget proposal, he would provide $1.5B for the Department of Homeland Security in order to protect U.S. federal networks and infrastructures from cyber security threats. Now, this should increase activity in the cyber security space.
HACK Could Rise After These Statements
That said, some traders have been watching HACK for quite some time now, and there could be trading opportunities in the name after these statements made by the White House. Traders looking to gain exposure to the cyber security sector may want to keep HACK on the watch list, and focus on anything Trump or any other White House Officials statements, related to cyber security.
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