According to a Space Robotics Market survey, the space robotics industry is expected to exceed $3.5 billion by the year 2025, which bodes well for investors looking for opportunities in the space industry via exchange-traded funds (ETFs). This is a trend not just happening in the U.S., but around the globe.
More governments are looking to funnel more capital into space research and exploration, which is fueling demand within the industry. Additionally, the rise of technology, such as artificial intelligence (AI) is helping the industry achieve rapid expansion.
Per a report by ReportsGo, “National organizations such as NASA, CSA, JAXA, etc., are introducing humanoid robots to perform the maintenance, servicing, and transportation operations to gain high efficiency, further developing the space robotics market. The rising trends of autonomous features and AI technology in robotic products will drive rapid industry expansion.”
During a visit to the Kennedy Space Center in Florida earlier this summer, U.S. Treasury Secretary Steven Mnuchin threw his support behind space innovation, particularly its ability to spur job creation. It’s something that U.S. President Donald Trump’s administration is willing to back, especially after requesting an additional $1.6 billion for the National Aeronautics and Space Administration (NASA) to relaunch a program to return humans to the moon.
Exploring the Procure Space ETF
This is certainly something that can help fuel the Procure Space ETF (NYSEArca: UFO) to future gains. In an exchange-traded fund (ETF) landscape that has over 2,000 funds for investors to choose from, it’s important to have product differentiation in this quest for assets under management like UFO–the world’s first global ETF to give investors pure-play access to the expanding space industry.
The UFO ETF tracks the S-Network Space Index, which focuses on companies that are significantly engaged in space-related activities. Index constituents span multiple industries, including satellite-based consumer products and services, rocket and satellite manufacturing, space technology hardware, and space-based imagery and intelligence services.
Approximately 80 percent of companies in the index derive the majority of revenues directly from their involvement in the space industry, enabling investors to potentially capture this growing segment of the global economy. The Commerce Department is already throwing its support behind the American space industry with ambitious goals for regulatory reform and promotional efforts.
Outside of the government realm, private companies like Amazon are propping up their space exploration ventures with investment capital. Amazon CEO Jeff Bezos has an entire other company dedicated to space exploration as the online retailer has ambitious plans to set up a network of more than 3,000 satellites to expand high-speed internet access worldwide.
Tesla CEO Elon Musk’s other company, SpaceX, expects revenues from rocket launch services to hit $3 billion per year. This can help provide the capital necessary to fund Musk’s larger dream of developing new spacecraft capable of flying customers to the moon as well as feed other ambitions of colonizing Mars.
Meanwhile, efforts for NASA to return humans to the moon will cost a pretty penny and then some–how about an estimated $20 to $30 billion. Believe it or not, it’s actually less costly than anticipated, but that allocation of government funds will certainly be a cause for debate on Capitol Hill.
For more market trends, visit ETF Trends.