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Should You Invest in the U.S. Global Jets ETF (JETS)?

Zacks Equity Research
·3 min read

Looking for broad exposure to the Industrials - Transportation/Shipping segment of the equity market? You should consider the U.S. Global Jets ETF (JETS), a passively managed exchange traded fund launched on 04/30/2015.

Retail and institutional investors increasingly turn to passively managed ETFs because they offer low costs, transparency, flexibility, and tax efficiency; these kind of funds are also excellent vehicles for long term investors.

Sector ETFs also provide investors access to a broad group of companies in particular sectors that offer low risk and diversified exposure. Industrials - Transportation/Shipping is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 3, placing it in top 19%.

Index Details

The fund is sponsored by U.S. Global Investors. It has amassed assets over $3.31 billion, making it one of the largest ETFs attempting to match the performance of the Industrials - Transportation/Shipping segment of the equity market. JETS seeks to match the performance of the U.S. Global Jets Index before fees and expenses.

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The U.S. Global Jets Index tracks the performance of Airline Companies across the globe with an emphasis on domestic passenger airlines.

Costs

Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.

Annual operating expenses for this ETF are 0.60%, making it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 0.04%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure that minimizes single stock risk, investors should also look at the actual holdings inside the fund. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

Looking at individual holdings, Southwest Airls Co (LUV) accounts for about 9.94% of total assets, followed by United Airls Hldgs Inc (UAL) and American Airls Group Inc (AAL).

The top 10 holdings account for about 56.86% of total assets under management.

Performance and Risk

So far this year, JETS has lost about -2.18%, and is down about -9.94% in the last one year (as of 12/13/2021). During this past 52-week period, the fund has traded between $19.38 and $28.71.

The ETF has a beta of 1.47 and standard deviation of 44.27% for the trailing three-year period, making it a high risk choice in the space. With about 51 holdings, it effectively diversifies company-specific risk.

Alternatives

U.S. Global Jets ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, JETS is a sufficient option for those seeking exposure to the Industrials ETFs area of the market. Investors might also want to consider some other ETF options in the space.

First Trust NASDAQ Transportation ETF (FTXR) tracks Nasdaq US Smart Transportation Index and the iShares U.S. Transportation ETF (IYT) tracks Dow Jones Transportation Average Index. First Trust NASDAQ Transportation ETF has $1.23 billion in assets, iShares U.S. Transportation ETF has $1.84 billion. FTXR has an expense ratio of 0.60% and IYT charges 0.41%.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.


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U.S. Global Jets ETF (JETS): ETF Research Reports
 
United Airlines Holdings Inc (UAL) : Free Stock Analysis Report
 
Southwest Airlines Co. (LUV) : Free Stock Analysis Report
 
American Airlines Group Inc. (AAL) : Free Stock Analysis Report
 
iShares U.S. Transportation ETF (IYT): ETF Research Reports
 
First Trust NASDAQ Transportation ETF (FTXR): ETF Research Reports
 
To read this article on Zacks.com click here.
 
Zacks Investment Research