Here’s how the space industry is growing and how to invest in the sector through ETFs.
The space industry is experiencing an era of rapid growth, with the number of satellites set to triple in the next 36 months. This expansion is being driven by ambitious missions to the Moon and Mars, with an exponential increase in space activities by the United States, the European Union, and China. Currently, within the first 1,500 kilometers from the Earth’s surface, orbital space hosts most operational satellites. However, this space is also crowded with thousands of pieces of space debris, making it crucial to adopt shared rules to avoid the first "space traffic jam" in history.
The new space economy and the role of Italy
Italy is a major player in the New Space Economy, thanks to its complete supply chain that ranges from satellite construction to launch, from in-orbit control to ground-to-sky telecommunications, up to the management of received data. This sector is acquiring significant economic value, fueled by continuous technological innovation and cost reductions, which are making space increasingly accessible.
The strategic importance of space
The Earth’s "zone of influence" has expanded to 1,500 kilometers above our heads, with satellites playing vital roles in communications, surveillance, security, agriculture, and military defense. The proliferation of private satellites, such as those of SpaceX with the Starlink constellation, is reshaping the space landscape. SpaceX, for example, plans to launch up to 15,000 satellites to offer global internet coverage. At the same time, Planet, with its 351 satellites, provides services ranging from education to maritime and agricultural monitoring.
The space race is also changing the geopolitical balance, with the United States and China at the forefront. China, in particular, has made great strides, launching lunar missions such as Chang’e 5 and developing cutting-edge technologies such as the first 6G broadcast satellite. This competition has significant implications for global space policies and the technology industry.
Space ETF Investment Opportunities
European investors now have the opportunity to participate in the growth of the space economy through a range of ETFs listed on European markets.
- The VanEck Space Innovators UCITS ETF (Ticker: JEDI), with a TER of 0.55%, invests in leading space companies such as EchoStar and Iridium Communications. This ETF is listed on exchanges such as Borsa Italiana, London Stock Exchange, and Deutsche Börse Xetra, allowing investors to access these opportunities easily.
- The HANetf Procure Space UCITS ETF Acc (Ticker: UFO), with a TER of 0.75%, is another significant fund that replicates the SPACE index, focusing on companies operating in the satellite and space sectors. This ETF is also available on the Milan and London Stock Exchanges and Deutsche Börse Xetra.
- Furthermore, the iShares Global Aerospace & Defence UCITS ETF (Ticker: DFND), with a TER of 0.65%, offers exposure to companies in developed markets in the aerospace and defense sector, including manufacturers of civil or military aerospace and defense equipment, parts or products. This ETF is available on markets such as the Milan and London Stock Exchanges, and Deutsche Börse Xetra.
- Similarly, the SPDR S&P Aerospace & Defense UCITS ETF (Ticker: AERO), with a TER of 0.40%, tracks the S&P Aerospace & Defense Select Industry Index, which includes companies in the aerospace and defense sectors and is also listed on Borsa Italiana, London Stock Exchange and Deutsche Börse Xetra.
The new space economy represents an extraordinary opportunity for technological and economic growth but requires careful management to avoid conflicts and orbital overcrowding. Italy, with its expertise and infrastructure, is well-positioned to play a leading role in this dynamic scenario.
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Original article published on Money.it Italy 2024-08-18 10:33:00. Original title: I migliori ETF che investono nello Spazio
