Looking for diversification through ASX ETFs? I'd buy these 2

These ETFs can provide exposure to great tech companies across the globe.

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Technology may be the best sector to invest in over the long term because tech companies can achieve high profit margins. And ASX-listed exchange-traded funds (ETFs) can help us gain exposure to that industry.

I am attracted to companies with high margins that grow revenue rapidly because of how quickly the bottom line can improve.

The ASX has several quality technology companies, such as TechnologyOne Ltd (ASX: TNE) and REA Group Ltd (ASX: REA). However, they are just a small part of the global technology scene.

A few ASX ETFs can provide compelling exposure to certain areas of the tech space that are very different to the banking and mining companies the ASX is known for. I think that's good for diversification.

Betashares Global Cybersecurity ETF (ASX: HACK)

The HACK ETF provides exposure to leading listing businesses around the world from the global cybersecurity sector.

Companies in the portfolio include Crowdstrike, Cisco Systems, Broadcom, Palo Alto Networks, Infosys, Leidos, Cloudflare and Okta.

With cybercrime on the rise, ETF provider Betashares expects the demand for cybersecurity services to grow strongly for the foreseeable future.

According to the 2023 ASD Cyber Threat Report, in Australia, the average cost of cybercrime per report increased by 14%, with the average cost for a small business being $46,000. The report also noted that the number of cybercrime reports reached 94,000, up 23% year over year.

As the world becomes increasingly digital, more people and businesses around the world will need defence against cybercrime, with particular security needed for banking, e-commerce, government services and so on.

Past performance is not a reliable indicator of future performance, but over the past five years, the HACK ETF has returned an average of 16.4% per annum.

Global X Morningstar Global Technology ETF (ASX: TECH)

This globally-focused ETF looks to invest in companies positioned to benefit from the increased adoption of technology, including businesses that offer software, platform and digital infrastructure services.

The ETF provider Global X notes that internet-enabled devices continue to expand to new categories, allowing manufacturers to monitor and service products through software upgrades.

While 77% of the portfolio is invested in US-listed businesses, other countries with a weighting of more than 1% including the Netherlands, Japan, Canada, Germany, Israel and Switzerland.

The TECH ETF portfolio has more than 30 positions, some more recognisable than others. SalesforceAutodeskShopifyVontier, Block, Cognizant, Lyft, and Workday are among the companies with a weighting of more than 4% in the fund.

Over the past five years, this ASX ETF has returned an average of 13.9% per annum.

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Motley Fool contributor Tristan Harrison has positions in REA Group. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Autodesk, BetaShares Global Cybersecurity ETF, Block, Cisco Systems, Cloudflare, CrowdStrike, Global X Morningstar Global Technology ETF, Okta, REA Group, Salesforce, Shopify, Technology One, and Workday. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has recommended Broadcom, Cognizant Technology Solutions, and Palo Alto Networks. The Motley Fool Australia has positions in and has recommended BetaShares Global Cybersecurity ETF. The Motley Fool Australia has recommended Autodesk, Cognizant Technology Solutions, CrowdStrike, Okta, Salesforce, Shopify, Technology One, and Workday. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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