Most investors typically opt for conventional investments to grow their personal wealth. However, savvy investors are recognizing that ETFs can be used in conjunction with ISAs to save and invest tax-efficiently. This combination not only offers the potential for growth but also provides a shield against unnecessary tax burdens, maximizing returns in the long run. For those exploring alternative investment vehicles, here are 5 of the most uncommon yet potentially profitable ETFs currently available in newer market sectors.
The Best AI & Robotics ETF
The Global X Artificial Intelligence & Technology ETF is considered to be one of the best ETFs on the market. It was launched in May 2018 and was created to produce investment results corresponding in general to the prices and yields of the Indxx Artificial Intelligence & Big Data Index, which comprises enterprises working in the development and use of AI and Big Data.
It is a non-diversified fund with a net asset worth of 567.79m USD. The expense ratio of this ETF is 0.68%.
AI covers many segments, and companies include businesses that have both household names and that are newcomers worldwide. Predictions indicate that the AI market could be worth 300bn USD by 2026.
The Best Cybersecurity ETF
The iShares Digital Security UCITS ETF USD is widely regarded as one of the top cyber or digital security ETFs globally. Launched in September 2018, the size of the fund totals 1.38bn GBP and its ongoing charge or expense ratio is 0.40%.
This ETF has been set up to track the STOXX® Global Digital Security Index. In turn, it tracks companies working in the digital security sector. These companies are engaged in working with, safeguarding and or handling sensitive data and accessing control of secure locations.
The worldwide cybersecurity market is forecast to be worth more than 345bn USD by 2026. Revenues in this sector are predicted to continue growing by approximately 10% to 13% per annum over the next decade.
The Best Blockchain & Fintech ETF
One of the top Blockchain and Fintech ETFs is the Global X Blockchain ETF (BKCH). It was launched in December 2021 and has assets with a total value of 61.96m USD with an expense ratio of 0.50%.
The Global X Blockchain ETF (BKCH) was formed to invest in businesses that have positioned themselves to reap the rewards from the increased adoption of blockchain technology. These businesses include companies involved in digital asset mining, blockchain and digital asset hardware and transactions, blockchain applications, and blockchain asset digital asset integration. This ETF has been set up to provide investment results that correspond closely to the price as well as the yield performance of the Solactive Blockchain Index.
In 2022, the global blockchain market had an estimated worth of over 10bn USD. By 2023, it has been suggested that this sector will grow tenfold and be worth in excess of 1.4tn USD.
The Best Space Exploration ETF
One of the best Space Exploration ETFs is the Procure Space UCITS ETF. There are GBP and USD versions. Launched in June 2021, the size of the GB fund (a relatively small ETFT domiciled in Ireland) totals 9m GBP, and the expense ratio is 0.75% per annum.
When launched, the Procure Space UCITS ETF Acc was the only ETF to track the S-Network Procure Space index. It is designed to mirror the performance of the underlying index via full replication (meaning buying all the index constituents). The dividends provided via this ETF are accumulated and reinvested in the same ETF.
The price has recently bottomed out near its all-time low, but it is starting to rise again. Satellite systems and associated technologies are likely to be a major growth market, as the growth of companies like Uber and Deliveroo demonstrate. GPS is Vital to their success in the same way as satellites are crucial for providing higher bandwidth and coverage in both broadband and telecoms.
Add to the equation the fact that space tourism and hospitality are becoming closer to grasp with wannabe customers queuing up to boldly go where no man has gone before as costs reduce, and it can be an attractive proposition to investors with a reasonable tolerance towards risk.
The Best Metaverse ETF
Metaverse ETFs are one of the most interesting technology sector trends at the moment, and the Roundhill Ball Metaverse ETF (METV) is the leader. It was launched in June 2021 and controls funds worth approximately 382.28m USD. It tracks the Ball Metaverse Index and has an expense ratio of 0.59%.
METV is a passively managed fund that invests in globally listed equities across various industries relating to what it considers to be the future iteration of today’s internet. The stocks are selected by a committee and are weighted in tiers and the 47 holdings include Alphabet (GOOGL), Amazon.com (AMZN), Apple (AAPL), Meta Platforms (META), Microsoft (MSFT), QUALCOMM (QCOM), NVIDIA (NVDA), Roblox (RBLX), Unity Software (U), and Taiwan Semiconductor Manufacturing (TSM).
With a CAGR of 45%, the global Metaverse market is expected to grow and be worth over 1.3tn by 2030.
