Global disruptions Put travel and airline ETFs in the spotlight

This month, on Father’s Day and the nineteenth anniversary of the baby’s birth, thousands of planes were canceled across the United States, creating what some have called an “Armageddon of Journey,” which has affected millions of travelers. The rest of the summer may not be much different.

For example, Delta Air Lines (NYSE 🙂 recently announced that they were canceling about 100 flights a day between July 1st and August 7th to improve performance.

Smaller airlines, including JetBlue Airways (NASDAQ 🙂 and Alaska Air (NYSE :), have also reduced their summer plans. Americans are now wondering if they should expect major delays over the weekend of July 4th.

Meanwhile, airport strikes and other travel disruptions in Europe and the UK continue to affect many people in this region. As a result, London-listed airlines, including British Airways owner IAG (LON :), easyJet (LON 🙂 and Wizz Air (LON :), have come under pressure.

Despite rising air fares, airlines benefited from strong travel demand. But now they face several challenges, including insufficient places and staff shortages.

As a result, Wall Street has been reluctant to invest in travel stocks. Since the beginning of the year, the indices have and lost about 33% and 37%. In comparison, the index fell 17.9% and 13.3%.

Analysts are discussing how the travel industry will develop in the coming months. Investors will keep an eye on upcoming quarterly measurements and forecasts from major airlines and other travel heavyweights.

Based on this information, here are two ETFs (exchange traded funds) that may be of interest to conflicting investors who now see opportunities in airlines and other travel stocks.

1. US Global Jets ETF

  • Current price: 17.42
  • 52 week range: $ 15.89 – 25.47
  • Expenditure percentage: 0.60% per year

On June 20, the International Air Transport Association (IATA) raised its forecast for the aviation industry’s economic performance for 2022. This year, revenues could increase by more than 50% to reach $ 782 billion and approach 2019 levels before the pandemic was part of our life.

So first on today’s list is the US Global Jets ETF (NYSE :), which primarily invests in airlines as well as aircraft manufacturers. The fund began trading in April 2015 and its net assets are $ 2.6 billion.

JETS currently has 50 stocks, with the top 10 making up more than half of the portfolio. Southwest Airlines (NYSE :), American Airlines (NASDAQ :), United Airlines (NASDAQ :); Delta Air Lines, Spirit Airlines (NYSE :), Air Canada (TSX 🙂 and Boeing (NYSE 🙂 top the list.

More than three-quarters of the companies are based in the United States. Next come the names of, among others, Canada (5.2%), Japan (2.7%), Turkey (2.2%) and Brazil (2.0%).

JETS has lost 17.4% since January and 31.2% over the past 12 months. It reached its lowest level in several years on 17 June. The department’s price-to-book ratio is 3.96x.

If the $ 17.50 level does not provide support, we may see a further drop below $ 17. Potential investors whose portfolios can withstand an uneven path may consider buying JETS dip.

2. SonicShares Airlines, Hotels, Cruise Lines ETFs

  • Current price: $ 3.66
  • 52 week range: $ 3.42 – $ 5.35
  • Expenditure percentage: 0.75% per year

As more countries lift travel restrictions, many consumers plan to “travel for revenge”, a way to compensate for lost trips during COVID-19 lockdowns. Statistics from Bank of America (NYSE 🙂 suggest that: “Expenditure on airlines and travel agents has increased more than 60% over the previous year.”

The next on our list of funds is SonicShares Airlines, Hotels, Cruise Lines (NYSE 🙂 ETF. It mainly invests in airlines, hotels and cruises around the world. This fund was first listed in May 2021 and its net assets are less than $ 10 million. In other words, it is a relatively new and small fund with no major trading history.

TRYP W1

TRYP currently has a basket of 62 shares, of which the top 10 represent 45% of the fund. North American equities make up nearly two-thirds of the portfolio, followed by Europe (17.5%), Asia-Pacific (15.8%) and Central and South America (0.7%).

Airlines have the largest share in TRYP with 45.0%. This is followed by hotel, restaurant and leisure shares (39%) and real estate investments (17%).

Big names include VICI Properties (NYSE :), which owns casinos, the Irish airline Ryanair (NASDAQ :), Singapore Airlines (SGX :); Southwest Airlines (NYSE :); Hilton Worldwide (NYSE :); and Norwegian Cruise Line (NYSE :).

The recent difficulties caused TRYP to fall to a record low on 17 June. The fund has lost about 21.1% since the beginning of the year and 29.6% over the past 12 months. Readers who want to take advantage of the increase in travel demand can keep this thematic fund on their radar.

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