With spring break fast approaching, many will be flocking to international destinations to get a reprieve from the hustle and bustle of life. This, in effect, should propel the ALPS Global Travel Beneficiaries ETF (JRNY).
Per Statista, the UNWTO World Tourism Barometer revealed that 2023 showed a continued recovery in global tourism after the 2020 pandemic put a proverbial dent in many travel plans. Statista noted that the recovery accounted for 88% of prepandemic levels to add to an estimated 1.3 billion in international tourist arrivals.
China’s exit from COVID-19 lockdowns also had a profound impact on global travel and tourism. After a resurgence of COVID cases, the country reinstituted social distancing measures that scaled back economic activity, but once those were lifted, travelers took to the ground, waters, and skies.
“In the first nine months of 2023, international tourist arrivals in the Asia-Pacific region reached 62 percent of pre-pandemic levels, with a clear upward trend towards the end of that period,” Statista reported. “That’s a significant improvement compared to 2022, when the region saw just 26 percent of 2019 arrivals due to ongoing travel restrictions, especially in China.”
What does this all mean for travel in 2024? If UNWTO forecasts are correct, more upside. The organization expects international tourism will make a full recovery by the end of the year and even surpass prepandemic levels. Of course, this is all happening despite high levels of inflation and geopolitical risks going on around the globe.
Juxtaposing that data with the Dow Jones U.S. Travel & Tourism Index confirms that trend, especially if it persists toward the upside. The index is up almost 60% within the past year, spiking during the 2023 holiday season and continuing that upward trend through the beginning of 2024.
‘Travel’ to This ETF
Given the growth trajectory that travel and tourism is seeing through the rest of the year, JRNY creates an ideal portfolio opportunity to get exposure to this industry. The ETF presents a compelling option, seeking to track the performance of the S-Network Global Travel Index (TRAVEL).
Overall, JRNY invests in companies principally engaged in, or deriving significant revenue from, the global travel industry, including four segments: booking & rental agencies, airlines & airport services, hotels, casinos & cruise lines, and global travel beneficiaries. This basically gives investors a broad array of exposure to travel and tourism, which is an opportune time if UNWTO’s optimistic prescience is correct.
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