Despite the current high volatility on Wall Street, new exchange-traded funds (ETFs) continue to hit the market in astonishing numbers. According to Bloomberg, the numbers from the year so far suggest that new ETF launches are on track to surpass last year’s historic boom.
Among the newcomers, many thematic funds offer access to emerging investment themes. A recent study by Brown Brothers Harriman indicates that:
“84% of global ETF investors plan to increase their ETF allocations, up 12% from 2021 results” and “38% of respondents plan to increase their ETF allocations in the next five years.” Allocate 20% of their portfolio to thematic ETFs.”
Today’s article features two new funds that can help readers diversify their portfolios and take advantage of emerging market trends. However, we must remind our readers that these new ETFs are generally small in size and have poor trading histories. It is therefore necessary to carry out a more thorough check beforehand.
1. Global X Green Building ETF
- Current price: $23.06
- 52 Week Range: $22.62 – $25.38
- Cost ratio: 0.45% per year
Creating sustainable built environments is a priority for governments and private companies. The World Green Building Council (WorldGBC) states that:
“Green building practices…include the design, planning, construction, operation, and recycling or renewal of a building at the end of its life.”
According to forecasts, the global green building materials market could reach $635 billion by 2030. Such an increase would represent a compound annual growth rate (CAGR) of more than 10%.
That’s why the Global X Green Building ETF (NASDAQ:) is first on today’s list. It invests in companies that derive at least half of their income from development, management materials, technologies or services related to green buildings. The products and services of these companies generally increase the energy efficiency of buildings and reduce CO2 emissions. The fund was launched in April 2022 and has net assets of just $2.4 million.
GRNR has 74 holdings, the top 10 of which represent more than a third of the portfolio. More than 80% of companies come from the real estate sector (80%), followed by the industrial sector (13.9%) and the consumer discretionary sector (4.6%).
Companies from Japan and the United States have the largest share with 24% and 20% respectively. This is followed by shares from France (11.7%), Singapore (8%), Hong Kong (7.3%), the United Kingdom (7.3%) and Finland (4.5%).
Key inventories include China Overseas Land & Investment, Finnish elevator and escalator group Kone Oyj (HE:), French electrical component manufacturer Legrand (EPA:), Carrier Global (NYSE: ), which supplies heating, ventilation and air conditioning ( HVAC) makes and security products and the Singapore-based real estate investment trust (REIT) Capitaland Investment (SGX:).
GRNR shares are currently trading at $23, down more than 9% from the intraday high of $25.38 reached on April 19. Long-term investors looking to participate in the growth of the green building ecosystem can explore this fund further.
2. AdvisorShares Managed Bitcoin Strategy ETF
- Current price: $19.44
- 52 Week Range: $18.98 – $26.26
- Cost ratio: 1.61% per year
Cryptocurrencies have been under heavy pressure so far in 2022. For example, they have lost about 35% and 51% respectively.
But despite the current uncertainty surrounding digital assets, a recent survey found that out of 600 financial advisors surveyed, 46% were interested in investing in crypto stocks, such as Coinbase Global (NASDAQ:). Similarly, nearly 45% indicated that they wanted to invest directly in crypto assets such as bitcoin.
Next on today’s list is the AdvisorShares Managed Bitcoin Strategy ETF (NYSE:), which invests in US-listed ETFs that focus on bitcoin futures, short-term fixed income, and cash. The fund manager coordinates the timing and amount of exposure to each asset class within the fund.
CRYP currently holds three main holdings which are ProShares Bitcoin Strategy ETF (NYSE:), Valkyrie Bitcoin Strategy ETF (NASDAQ:) and BlackRock. Liquidity Funds Treasury Trust Fund Institutional Stocks (NASDAQ:TTTXX).
This actively managed fund started trading in late April and its net assets are no more than $1 million. CRYP may be of interest to readers looking to add some bitcoin exposure to their long-term portfolios. However, they have to take into account the high expense ratio.