AOT Invest believes that not all software exposure should be based on market cap, and that profitability is important.
On Tuesday, the firm launched the AOT Software Platform ETF (NYSE:AOTS), a new ETF aimed at capturing companies that build the foundation of modern digital applications, from cloud infrastructure to payments and enterprise software. Instead of just tracking the largest names in tech, the ETF uses a quality-focused framework that filters and weighs holdings based on profitability and efficiency measures.
The index includes 50 companies, each capped at a maximum weight of 7.5% and a minimum of 0.5%. To be eligible, at least 20% of revenue must come from software activities. The top five holdings, namely, Nvidia Corp (NASDAQ:NVDA), Meta Platforms, Inc (NASDAQ:META), Microsoft Corp (NASDAQ:MSFT), Amazon.com Inc (NASDAQ:AMZN), and Alphabet Inc (NASDAQ:GOOGL), together…
