Doug Goodwille from Kayne Anderson speaks to Drew Meredith from The Inside Network on market thinkers.
While a surging gold price is on hold as the world adjusts to a Trump presidency, all the factors that saw its price rise more than 50 per during his first term in office – trade disputes, fiscal deficits and geopolitical tensions – are almost certainly guaranteed the second time around.
Space: The final frontier for ETFs?
The highly successful team at New York-based ARK Invest – led by CEO Catherine Wood, who many call the modern-day “growth” version of Warren Buffett – is launching a new space exploration ETF, under the code (NYSE: ARKX). The company is known for operating the largest actively managed ETF in the world – the Ark Innovation ETF (NYSE: ARKK). Wood’s expertise certainly delivered for investors in 2020, with ARKK returning an outstanding 170% over the past year. The new Ark ETF is a dedicated bet on space exploration.
Right. You’re probably thinking, “space exploration is so 80s,” but there is in fact a new space race happening right now. A race to the moon has begun but this time it’s slightly different. China landed a probe on the far side of the moon a year ago, and has germinated cotton seeds up there as an experiment. NASA then announced the Artemis program to send humans (including the first woman) back to the moon by 2024. With the success of Elon Musk’s SpaceX, his company was picked to launch a NASA-funded mission to the Moon in 2022. It involves launching a lunar lander to the Moon’s South Pole.
Jeff Bezos’ Blue Origin is the other company that has emerged with aspirations to bring people into space and resources down to earth. This has led Wood to launch the space-focused ETF, in the belief that the next big boom will be in this sector.
Listed companies that might be included in the ETF, are Virgin Galactic (NYSE: SPCE), whose shares hit a high of $US33.40 this week after rising 21.4%. The highly popular special purpose acquisition vehicle or SPAC, Stable Road Acquisition Corp (NASDAQ: SRAC), also rose almost 30% to $US22, as the company is expected to list space tow truck company Momentus this year. Other companies likely to be included are Maxar Technologies (NYSE: MAXR), (NASDAQ: SRAC), and US defence contractors such as Northrop Grumman (NYSE: NOC) and Lockheed Martin (NYSE: LMT).
The launch of the new ETF will also drum-up interest in almost all things tech, i.e., 5G, artificial intelligence, and robotics. All in all, as we’ve seen with the lithium and EV boom that took place last year, if Catherine Wood is right, space exploration is the place to be for 2021, and Ark Invest’s new space exploration ETF may be a savvy way to play it.
