As thematic ETFs see a spike in popularity, one the funds that is seeing heavy inflows is the Global X Lithium & Battery Tech ETF (LIT).

A CFRA “Funds In Focus” report cited the heavy inflows into Global X the past year when sub-categorizing funds based on a Solactive index association.

“According to Global X, there was $133 billion in invested thematic ETFs at the end of March 2021 — more than a five-fold increase in the past year,” the report said. “Investors have embraced the diversification and ease of use benefits, while targeted assets toward strategies focused on cannabis, clean energy, electric vehicles, health care innovation, 3D printing, video games, and more.”

“Many Global X ETFs are tracking a custom index run by Solactive,” the report added. “In the past year, Global X gathered $14 billion of net inflows pushing its overall asset base to $30 billion, according to CFRA. Many of the firm’s larger ETFs are tracking a custom Solactive index. For example, LIT, which has $2.8 billion in assets aided by $1.8 billion in net inflows in the past year, tracks the Solactive Global Lithium Index.”

Lithium ETF Sees Heavy Inflows as Thematic ETF Popularity Spikes 1

LIT seeks to provide investment results that correspond generally to the price and yield performance of the Solactive Global Lithium Index, which is designed to measure broad-based equity market performance of global companies involved in the lithium industry. LIT gives investors:

  • Efficient Access: LIT offers efficient access to a broad basket of companies involved in lithium mining, lithium refining, and battery production.
  • Thematic Exposure: The fund is a thematic play on lithium and battery technology.
  • Exceptional Performance: The fund is up about 150% the past year.

An Electric Boost for ‘LIT’

U.S. president Joe Biden’s push for a greener America can help smooth the path for electric vehicles and LIT.

“Joe Biden’s plan for a greener U.S. economy could drive gains for clean-energy ETFs owning companies engaged in a wide array of green businesses, including electric vehicles, energy storage, and smart-grid infrastructure,” a Barron’s article noted.

“Announced last week, the $2 trillion American Jobs Plan calls for $174 billion in spending to expand the electric-vehicle market, roll out incentives to install 500,000 EV chargers by 2030, electrify 20% of the nation’s yellow school buses, and replace 50,000 diesel transit vehicles,” the Barron’s article added.

LIT Chart

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