Investors from China are snapping up thematic ETFs with gusto. U.S. ETF investors can do the same with a few thematic funds from Global X that are posting big daily share volumes.
“Chinese investors are souring on exchange-traded funds that track broad indexes, but they’re snapping up thematic—or sectoral—ETFs, such as those that invest in the nation’s Science and Technology Innovation Board,” a Bloomberg article said.
“In one week through March 2, Chinese asset managers raised $1.7 billion for four funds that purely invest in ETFs that track the stocks listed on the two-year-old Nasdaq-style board in Shanghai, known as the STAR Market,” the article added. “And last year, four STAR Market ETFs received 100 billion yuan ($15.4 billion) in subscriptions from retail investors in a 24-hour period, the fastest takeup in the 16-year history of Chinese ETFs.”
The first fund to consider is the Global X Lithium & Battery Tech ETF (LIT ) for an indirect play on the rise in demand for electric vehicles. LIT seeks to provide investment results that correspond generally to the price and yield performance of the Solactive Global Lithium Index, which is designed to measure broad-based equity market performance of global companies involved in the lithium industry.
LIT gives investors:
- Efficient Access: LIT offers efficient access to a broad basket of companies involved in lithium mining, lithium refining, and battery production.
- Thematic Exposure: The fund is a thematic play on lithium and battery technology.
Infrastructure and Cloud Computing
Another fund seeing strong interest is the Global X U.S. Infrastructure Development ETF (PAVE). PAVE seeks to provide investment results that correspond generally to the price and yield performance, of the Indxx U.S. Infrastructure Development Index.
The underlying index is designed to measure the performance of U.S. listed companies that provide exposure to domestic infrastructure development, including companies involved in construction and engineering; production of infrastructure raw materials, composites, and products; industrial transportation; and producers/distributors of heavy construction equipment.
Lastly, there’s the Global X Cloud Computing ETF (CLOU), which takes advantage on the rise of cloud computing in a more socially distanced environment. CLOU seeks to track the Indxx Global Cloud Computing Index and the fund holds a basket of companies that potentially stand to benefit from the continuing proliferation of cloud computing technology and services.
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