The popularity of ETFs is growing in the investment world. Investors have already added $607.7 billion to U.S.-listed ETFs so far in 2021 (per an ETF.com article). In what seems like a favorable period for the launch of new ETFs, SS&C ALPS Advisors has launched the ALPS Global Travel Beneficiaries ETF JRNY on the NYSE Arca.
In this regard, Laton Spahr, President of SS&C ALPS Advisors, has reportedly commented that "SS&C ALPS Advisors continues to build a compelling suite of thematic strategies for ETF investors. We believe global travel spending may improve as the global middle class expands and the desire to spend on experiences grows. Our new ETF may provide differentiated exposure to a potentially durable theme."
JRNY in a Nutshell
The fund's strategy provides a diversified exposure to the global travel industry. It tracks the S-Network Global Travel Index, which discovers exchange-traded stocks of companies that are materially engaged in the global travel industry. The fund's portfolio parks money in booking and rental agencies, airlines and airport services, hotels, casinos and cruise lines along with travel-related companies short-listed through an artificial intelligence-driven screening process, such as luxury retail, entertainment, leisure, food and beverage, and payment processing vendors.
JRNY has gathered AUM of $1.2 million. It charges an expense ratio of 0.65%. The Estee Lauder (NYSE:EL) Company Inc. Class A (EL), Walt Disney Co. (NYSE:DIS) and L'Oreal SA (OR FP) form the top three holdings of the fund.
What Makes JRNY an Attractive Pick?
The travel industry has been getting the much-needed boost from the reopening of the U.S. economy, accelerated coronavirus vaccine rollout initiatives and solid fiscal stimulus support. President Joe Biden has outlined a very effective plan to increase the vaccination rate and control the outbreak. He has made it mandatory for federal employees to get the COVID-19 vaccination, per a CNBC article. The Biden government will also issue guidelines to the Labor Department asking for the imposition of vaccine mandates for employers with more than 100 employees or to run weekly tests. The application of booster shots and imposition of vaccine mandates are expected to help curb the spread of coronavirus.
ETF Competition
The fund faces tough competition owing to its focus on the travel industry. Below we discuss a few ETFs that seek to benefit from the space:
Consider the following interesting options:
U.S. Global Jets ETF JETS
This fund provides exposure to the global airline industry, including airline operators and manufacturers from all over the world, by tracking the U.S. Global Jets Index. In total, the product holds 52 securities and charges investors 60 basis points (bps) in annual fees. The fund has gathered $3.47 billion (read: ETFs in Focus on Airlines' Slowdown Warnings).
ETFMG Travel Tech ETF AWAY
This is the first ETF that offers direct access to the technology-focused global travel and tourism industry. It follows the Prime Travel Technology Index NTR, charging investors 75 bps in annual fees. The fund holds 34 stocks in its basket with travel bookings & reservations companies accounting for 51.9% of assets, followed by 17.6% in travel advice companies and 16.6% share in travel price comparison firms. AWAY has accumulated $279.4 million in its asset base (read: ETFs to Rise on Full FDA Approval for Pfizer (NYSE:PFE) COVID-19 Vaccine).
The Defiance Hotel, Airline, and Cruise ETF CRUZ
This product tracks the BlueStar Global Hotels, Airlines, and Cruises Index, which measures the performance of globally listed companies primarily engaged in travel and tourism industries. Holding 51 stocks in its basket, CRUZ, launched in June this year, has gathered around $12.4 million in its asset base and charges 45 bps in annual fees.
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ETFMG Travel Tech ETF (AWAY): ETF Research Reports
U.S. Global Jets ETF (JETS): ETF Research Reports
Defiance Hotel, Airline, and Cruise ETF (CRUZ): ETF Research Reports
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