As Election Day Gets Closer, Infrastructure ETFs Are Getting Interesting

With Election Day 2020 drawing closer, infrastructure exchange traded funds, including the AGFiQ Global Infrastructure ETF (GLIF), are bound to move into the spotlight.

The AGFiQ Global Infrastructure ETF uses a multi-factor investment process to seek long-term capital appreciation by investing primarily in global equity securities in the infrastructure industry. President Trump is pitching a 10-year, $1 trillion infrastructure plan, which is scaled back from his 2016 campaign trail plan. Indeed, costs play a role in determining the fate of domestic infrastructure efforts.

“President Trump is rolling back the nation’s main environmental review law in a bid to speed up the construction of freeways and other infrastructure projects, describing it as a job killer and ‘horrible roadblock,’” reports Ebony Bowden for the New York Post.

Recently, President Trump’s polling numbers are taking hits for a variety of reasons with some polls indicating he’s trailing or losing ground in some states critical to his reelection efforts. With that in mind, a robust infrastructure plan could help get the economy back on solid ground and replenish some of the jobs lost during the coronavirus pandemic.

GLIF as a Second-Half Play

“Speaking before a crowd at a UPS warehouse in Atlanta, Trump announced he was signing an executive order overhauling the 50-year-old National Environmental Policy Act, or NEPA, which he said had stymied important projects and limited economic growth,” according to the Post.

The strong, consistent demand for infrastructure has delivered stable, repeatable cash flows to investors. Meanwhile, population growth, aging infrastructure, and constrained government budgets are creating opportunities for the private sector. The high cost of entering the infrastructure business also limits competition or provides a wide economic moat for those already in the field.

Some market observers believe riskier assets aren’t adequately reflecting the shortening odds of former Vice President Joe Biden defeating President Trump in November. Others assert a Biden victory won’t be as bad for stocks as investors may currently believe. However, Trump may still have some say when it comes to infrastructure.

“According to the White House, federal agencies today take an average four and a half years to conduct the required reviews of major infrastructure projects like highways,” reports The Post. “The president has reversed more than 100 environmental rules since taking office, according to a New York Times analysis, including fuel efficiency standards which earned a rebuke from his predecessor Barack Obama.”

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The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.