First Trust has unveiled a pair of thematic ETFs – one capturing global aerospace and defence spending, the other global semiconductor supply chains.
The First Trust Indxx Global Aerospace & Defence UCITS ETF (MISL) and the First Trust Bloomberg Global Semiconductor Supply Chain UCITS ETF (CHPS) have listed on the London Stock Exchange (LSE) with total expense ratios (TERs) of 0.65% and 0.60%, respectively.
MISL captures companies which derive at least 50% of their revenues from aerospace or defence, described by the firm as ‘pure-play’, with the top 50 companies by market cap included subject to a 4.5% cap.
Rahul Sen Sharma, president and co-CEO at Indxx, said: “In 2023, global defence expenditures reached approximately $2.44trn, with the US, China, Russia, India, and Saudi Arabia collectively accounting for nearly 61% of this spending. Fuelled by this global military expenditure, the demand for advanced defence technologies and capabilities has also increased.”
Rupert Haddon (pictured), managing director at First Trust Global Portfolios, added that the product gives investors “the chance to tap into this sadly pivotal global theme.”
CHPS is also a 50-stock portfolio, with a 70% weighting to companies in the semiconductor manufacturing value chain and a 30% weighting to semiconductor device companies exposed to high growth and innovative end markets.
Haddon added: “Today, governments and corporations worldwide are ramping up investments to secure and diversify these supply chains. As technology advances, the role of semiconductor chips - and the networks that sustain them - will only grow more vital.”
The new launches bring First Trust’s UCITS ETF family to 36, most recently introducing a quality growth equity fund.
