Cybersecurity Stocks Break Out on COVID-19 Tailwinds

Cybersecurity is suddenly back in the spotlight thanks to the COVID-19 pandemic. Hackers have hit every country on earth with coronavirus-themed cyberattacks. Meanwhile, businesses are betting on remote work arrangements enduring even after the current restrictions end. This should translate to more spending on cybersecurity moving forward, with the cloud- and software-based security segments winning an ever-greater piece of that spending. Stocks are already moving in anticipation.

Related ETFs: ETFMG Prime Cyber Security ETF (HACK), First Trust NASDAQ Cybersecurity ETF (CIBR), iShares Cybersecurity and Tech ETF (IHAK)

Surge in Cybersecurity Attacks Under COVID-19 Guise 

Three factors have combined to create a perfect storm for cybercriminal activity: lower staffing levels at security operation centers + millions of people suddenly working remotely outside enterprise firewalls + high interest in COVID-19 news. It is no surprise then that governments and corporations around the world have reported a material increase in cyber threats during the pandemic.

Cybercriminals are capitalizing on anxiety about the virus by to spread infections of their own. Emails doctored to look like a company’s purchase order for face masks or other supplies have seemed convincing enough to trick an employee into wiring payments to a fraudulent account. In another phishing case, an email purportedly from the World Health Organization (WHO) was sent to companies in the transportation sector. It contained false instructions about how to monitor crews aboard ships for coronavirus symptoms and included an infected attachment with those instructions.

Hackers are also exploiting the growing work-from-home trend by either attacking existing virtual private networks that allow employees to connect to their offices, or by passing off their malicious tools as remote collaboration software produced by known entities like Zoom and Microsoft…