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

Designed to provide broad exposure to the Industrials - Transportation/Shipping segment of the equity market, the U.S. Global Jets ETF (JETS) is a passively managed exchange traded fund launched on 04/30/2015.

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.

Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Industrials - Transportation/Shipping is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 12, placing it in bottom 25%.

Index Details

The fund is sponsored by U.S. Global Investors. It has amassed assets over $228.29 M, making it one of the average sized 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.

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

Costs

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.

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 2.61%.

Sector Exposure and Top Holdings

While ETFs offer diversified exposure, which minimizes single stock risk, a deep look into a fund's holdings is a valuable exercise. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

Looking at individual holdings, American Airls Group Inc (AAL) accounts for about 15.13% of total assets, followed by Southwest Airls Co (LUV) and Delta Air Lines Inc Del (DAL).

The top 10 holdings account for about 72.83% of total assets under management.

Performance and Risk

The ETF has lost about -52.48% so far this year and is down about -45.84% in the last one year (as of 03/25/2020). In that past 52-week period, it has traded between $12.16 and $32.30.

The ETF has a beta of 1.35 and standard deviation of 30.45% for the trailing three-year period, making it a high risk choice in the space. With about 34 holdings, it has more concentrated exposure than peers.

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 reasonable 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.

SPDR S&P Transportation ETF (XTN) tracks S&P Transportation Select Industry Index and the iShares Transportation Average ETF (IYT) tracks Dow Jones Transportation Average Index. SPDR S&P Transportation ETF has $86.39 M in assets, iShares Transportation Average ETF has $319.04 M. XTN has an expense ratio of 0.35% and IYT charges 0.42%.

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
 
Southwest Airlines Co. (LUV) : Free Stock Analysis Report
 
Delta Air Lines, Inc. (DAL) : Free Stock Analysis Report
 
American Airlines Group Inc. (AAL) : Free Stock Analysis Report
 
iShares Transportation Average ETF (IYT): ETF Research Reports
 
SPDR S&P Transportation ETF (XTN): ETF Research Reports
 
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