How Rocket Reuse Upgrades Are Turbocharging Space Stocks

Rapid rocket reusability is key to lowering launch costs, turbocharging space exploration, and thus propelling investments in the space stocks segment.

SpaceX has been able to reduce rocket reuse time from 27 to 21 days in the past year, according to Sam Korus, director of research, autonomous technology & robotics, at ARK. 

“If the cost were to correlate with time, which seems likely, our research suggests that the cost to refurbish the first stage of the Falcon 9 rocket has dropped from ~$13 to ~$1 million during the past five years,” Korus wrote. “This improvement, along with other reusability developments, suggests the cost-per-kilogram to low Earth orbit of a reused Falcon 9 is ~$800, compared to ~$2,700 for a new Falcon 9. For historical context, it cost between $450 million and $1.5 billion per launch to refurbish the Space Shuttle.”

Investors looking to add focused exposure to global stocks engaged in space exploration and innovation should consider the ARK Space Exploration & Innovation ETF (ARKX).

ARKX is actively managed and includes companies focused on innovation across the space industry. ARK Invest defines “space exploration” as leading, enabling, or benefitting from technologically enabled products and/or services that occur beyond the surface of the Earth, including orbital and suborbital aerospace companies, companies that stand to benefit from aerospace activities, and firms that develop technology that enables space exploration, including robotics, artificial intelligence, materials, 3D printing, and energy storage, according to the fund’s website.

ARK’s products are geared toward investors who have the fortitude and faith to ride out short-term volatility in favor of long-term gains, according to VettaFi.

The top 10 holdings in the fund as of September 29 include Trimble Inc. (TRMB, 10.21% weight), Iridium Communication Inc. (IRDM, 7.73% weight), Aerovironment Inc. (AVAV, 7.37% weight), Kratos Defense & Security (KTOS, 6.97% weight), L3Harris Technologies Inc. (LHX, 5.98% weight), the 3D Printing ETF (PRNT, 5.64% weight), Komatsu Ltd. (6301, 3.90% weight), Velo3d Inc. (VLD, 3.38% weight), Deere & Co. (DE, 3.17%), and Teradyne Inc. (TER, 2.93%), according to the fund’s website. 

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