6 Travel ETFs to Consider in 2022 | The Motley Fool



As the world learns how to live with Covid-19, the travel industry is once again in growth mode. US leisure travel has reached new highs, but business travel is still down from pre-pandemic levels. The same goes for international travel. Vacations still have a long way to go to fully recover, and new digital tools for booking accommodations are on the rise. Over the next decade, some estimates indicate that global travel spending will increase by an average of 5% to 6% per year — double the average annual growth rate of the global economy.

An airplane is drawn on a coffee cup bubble placed on a map

Source: Getty Images

Investing in travel ETFs can make a lot of sense right now. If you think the travel industry will continue to grow and the global consumer will travel more in the long term, buying a travel ETF can provide healthy investment returns.

Investing in travel ETFs

The global travel industry is a large area that spans many economic sectors. At one end are companies like airlines, vehicle manufacturers (including RVs or bicycles), and energy companies that make people move. On the other side are destinations like theme parks and cruise line operators, restaurants, and accommodations like hotels and rentals. Connecting the two are travel agencies, digital booking services and other tools to streamline travel.

It can be difficult to choose the right stocks in such a wide area. But buying a travel ETF (exchange-traded fund) can make an instant difference in major travel industry stocks. Here are the six values ​​for 2022:

Data as of August 29, 2022.

The name of the ETF

Assets under management

Annual fee

press release


2.56 billion dollars


A large ETF focuses on airline operators.

PowerShares Volatility Leisure and Entertainment ETF (NYSEMKT:PEJ)

900 million dollars


The oldest ETF on this list has a well-diversified portfolio of travel stocks.


188 million dollars


A game focused on travel and accommodation technology.

Defiance Hotel, Airline and Cruise ETF (NYSEMKT:CRUZ)

37.4 million dollars


Another ETF focused on hotels, air travel and sea vacations.

ALPS Global Travel Consumer ETF (NYSEARCA:JRNY)

11.9 million dollars


An ETF that invests in travel companies and related industries that benefit from vacations.

AdvisorShares Hotel ETF (NYSEMKT: BEDZ )

6.26 million dollars


For investors who want to focus on accommodation and travel real estate.

1. US Global Jets ETF

US Global Jets ETF is the largest fund on our list, with more than $2.5 billion in client funds under management as of this writing. It is also the only ETF focused on the airline industry, an absolutely essential business for the travel space. The US Global Jets ETF was launched in 2015. The annual fee is 0.6%, which works out to $6 per year per $1,000 invested, deducted from the ETF’s performance.

The majority of the US Global Jets ETF’s portfolio is dedicated to US airline operators. One third of the property is invested Southwest Airlines (NYSE:LUV), Delta Air Lines (NYSE:DAL), and American Airlines ( NYSE:AAL ) is also in the mix for international carrier stocks, as well as a few online travel booking stocks. But overall, the ETF operates on the same plane as American Airlines stocks. This fund is for investors who believe that the rate of air travel will gradually increase over time.

2. PowerShares Dynamic Entertainment & Leisure ETF

The PowerShares Dynamic Leisure and Entertainment ETF is from a large investment firm. Invesco (NYSE: IVZ ) ETF has been around since 2005 and has raised over $900 million in client funds. It charges an annual fee of 0.55%.

The ETF is a more diversified travel industry offering. Although limited to 30 stocks in the entertainment and leisure industry, companies in the portfolio include businesses such as event promoters and venue managers. Live Nation Entertainment (NYSE:LYV), Hotels Marriott International (NASDAQ:MAR), and the online travel giant Reservation of holdings (NASDAQ:BKNG) The PowerShares Dynamic Leisure and Entertainment ETF has underperformed the S&P 500 index since the fund’s inception, largely due to the 2020 pandemic.

3. ETFMG Travel Tech ETF

As the name suggests, ETFMG Travel Tech ETF is the best fund on our list. It has $188 million in funds under management and charges 0.75% per annum. And this is a new ETF. It was early 2020 before the outbreak began.

In the year Airbnb (NASDAQ:ABNB) and Booking Holdings. There are also businesses that praise it as a ride. Uber (NYSE:UBER) in the mix, as well as smaller travel agencies and planning companies.

4. Defiance Hotel, Airline, and Cruise ETF

The next ETF is a new offering starting in the summer of 2021. The Defense Hotel, Airline and Cruise ETF is designed to capture investors’ interest in potential rebounds in the global travel industry, although the portfolio does not meet these expectations. expectations. The fund manages over $37 million and charges 0.45% annually.

The Defiance Hotel, Airline and Cruise ETF consists of 56 stocks. The name refers to the composition of the portfolio. Top holdings include Marriott International, Delta Air Lines and Major Cruise Line Carnival (NYSE:CCL) Although it has generally underperformed the market in its short existence, the ETF could be a top choice for investors looking for concentrated exposure to lodging, air travel, and cruise lines.

5. ALPS Global Travel Users ETF

Another recent ETF offering, the ALPS Global Travel Beneficiaries ETF, will accumulate just under $12 million in funds since its launch in late 2021. It charges 0.65% in annual fees.

Although still small at this stage, the ALPS Global Travel Beneficiaries ETF aims to be a well-diversified investment option. Top stocks include the aircraft manufacturer Boeing (NYSE:BA), an entertainment conglomerate Walt Disney (NYSE:DIS), and a payments and travel company American Express (NYSE:AXP), as well as several other businesses mentioned above. A diversified approach to travel and adjacent industries could serve the ETF well in the coming years.

6. AdvisorShares Hotel ETF

This ultimate ETF, the smallest with over $6 million in client funds under management, is another great travel offering. The AdvisorShares Hotel ETF focuses on hotels, lodging, casinos (gaming) and related travel sub-industries. The actively managed fund has a high expense ratio of 0.99% per annum.

Fund managers focus on profitable businesses that have a dominant position among their competitors. As of this writing, the top three stocks in the portfolio are the oil and gas worker housing specialist. Target hosting (NASDAQ: TH), a resort and vacation property manager Blue green vacation package (NYSE:BVH) and Marriott, like other travel companies with a focus on profitable companies that haven’t been hit by the pandemic, have held the ETF relatively well so far compared to some of its peers on this list. However, since most of its holdings are real estate stocks, it may not have the same growth potential as other travel ETFs.

Related investment topics

Travel investments are a long-term theme.

Although the travel industry has taken a beating over the past few years, this is an area of ​​the global economy that should grow at a steady pace over the next decade. However, as with other consumer spending, travel stocks can be highly vulnerable to overall economic health. Expect lots of bumps in the road. However, for investors who believe that travel will expand over the years, investing in a travel ETF can be a solid alternative to a diversified portfolio that includes other investment themes.

American Express is an advertising partner of The Ascent, a Motley Fool company. Nicholas Rossolillo has positions at Airbnb, Inc. The Motley Fool has positions in and recommends Airbnb, Inc., Booking Holdings and Walt Disney. Motley Fool recommends Carnival, Delta Air Lines, Live Nation Entertainment, Marriott International, Southwest Airlines and Uber Technology and recommends the following options: Long January 2023 $115 calls to Marriott International, Long January 2024 $145 calls to Walt Disney and Short January 2024 $155 By Walt Disney Calls. The Motley Fool has a disclosure policy.


Source link

Leave a Reply

Your email address will not be published. Required fields are marked *