How to Invest in the Drone Industry Now: Diving in to the UAV ETF
Recently, some DRONELIFE articles have had a tag line:
[Company name] is held in the AdvisorShares Drone Technology ETF [NYSE ARCA:UAV], the only ETF dedicated to the drone economy. The AdvisorShares Drone Technology ETF is a thematic investment strategy seeking to capture the growth opportunities in drones and autonomous vehicles (AV). AdvisorShares is a DRONELIFE sponsor.
At DRONELIFE, we write often about the growth of drones in industry and advanced air mobility – and we take calls and emails every month from individuals who want to know how to invest in the drone industry now. The AdvisorShares Drone Technology ETF (UAV) is one way to add drones to your portfolio.
Continue reading below, or listen:
DroneLife · How – To – Invest – In – The – Drone – Industry – Diving – Into – The – AdvisorShares – UAV – ETF
An ETF, or exchange-traded fund, is similar to a mutual fund. When investors buy shares of an ETF, they are getting access to a basket of different of stocks. In the case of UAV, the ETF currently consists of 37 companies that are involved in the drone economy.
“The drone and eVTOL industries are in the early innings and there are a lot of companies jockeying for position,” said Luca Esposito, founder of the investment group sponsoring UAV. “It is a very competitive environment. This has made it difficult for investors who want exposure to the space. The UAV ETF alleviates a lot of those problems by offering thematic diversification and active portfolio management.”
The portfolio includes companies like Red Cat Holdings (NASDAQ:RCAT), AgEagle Aerial Systems (NYSEAMERICAN:UAVS) and Draganfly (NASDAQ:DPRO), along with military drone manufacturer, AeroVironment (NASDAQ:AVAV). Draganfly and AeroVironment have been in the news lately as they provide drones to Ukraine.
Ondas Holdings (NASDAQ:ONDS) and its subsidiary, American Robotics, provide an example of the expanding applications for drone technology. Their autonomous drones are being used by Chevron to manage, monitor and inspect oil and gas fields.
“When people think of drones, they typically only think hardware,” Esposito said. “The reality is that there is also an incredible amount of AI and software behind these systems. Companies have figured out the ‘Drone-as-a-service,’ recurring revenue business models, and are leveraging the vast amounts of data being collected.”
There are also companies like Qualcomm (NASDAQ:QCOM), Teledyne-FLIR (NYSE:TDY) and NVIDIA (NASDAQ:NVDA) in the ETF that provide chips, sensors and other drone components.
Then there are the leaders in home delivery: Amazon (NASDAQ:AMZN), UPS (NYSE:UPS), FedEx (NYSE:FDX) and Google (GOOG). In the first quarter of 2022, Google’s subsidiary, Wing, completed over 50,000 commercial drone deliveries, up more than three times year-over-year. Levitate Capital predicts that drone logistics will become the fastest growing segment after 2025.
“People want delivery faster than ever, whether it’s products, medicine or food,” Esposito said. “More and more companies are turning to drones to meet that demand and do it efficiently. Walmart just announced the other day that they’re expanding their drone-delivery service to reach 4 million households. Amazon is launching a similar program in California.”
In terms of portfolio composition, at least 25% of UAV will consist of the Aerospace & Defense industry. Another roughly 20% consists of Advanced Air Mobility and eVTOL (electric vertical take-off and landing) companies: i.e., Joby Aviation (NYSE:JOBY), Archer Aviation (NYSE:ACHR), Blade Air Mobility (NASDAQ:BLDE), Lilium (NASDAQ:LILM), EHang Holdings (NASDAQ:EH) and Vertical Aerospace (NYSE:EVTL). Morgan Stanley Research has said that accelerating tech advances and investment in autonomous urban aircraft could create a $1.5 trillion market by 2040.
UAV is the only ETF that targets the drone tech and eVTOL ecosystems. For more information, visit the AdvisorShares website – and keep an eye out for the UAV tag line, to read more about the many players represented.
Read more about the ETF and some of the companies included:
A Once-in-a-Lifetime Experience at the NYSE: Celebrating UAV, a New Way to Invest in the Drone Industry
Joby Aviation Gets Part 135 Carrier Certificate: Company Plans eVTOL Service for 2024
Archer and Hexcel Partner: Ramping Up eVTOL Manufacturing
Blade Air Mobility Announces First Quarter Earnings and Expansion into Europe
Wing Drone Delivery in Texas Starts This Week: Walgreens, Texas Health, EasyVet, and Ice Cream
Amazon Drone Delivery: A Brief History of the Patents, Problems and Progress from the DRONELIFE Archives
From the Floor of Xponential 2022: Teledyne FLIR Hadron? 640R More Power, More Resolution in a Small Form Factor
Miriam McNabb
Miriam McNabb is the Editor-in-Chief of DRONELIFE and CEO of JobForDrones, a professional drone services marketplace, and a fascinated observer of the emerging drone industry and the regulatory environment for drones. Miriam has penned over 3,000 articles focused on the commercial drone space and is an international speaker and recognized figure in the industry. Miriam has a degree from the University of Chicago and over 20 years of experience in high tech sales and marketing for new technologies.
For drone industry consulting or writing, Email Miriam.
TWITTER:@spaldingbarker
Subscribe to DroneLife here.
See Also
South Korean Government to Invest 1.2 Trillion in Drone Industry
How to Invest in Drone Technology
Drone Industry Sees Trade Show Consolidation: Commercial UAV Expo Scoops Up Drone World Expo
South Korea Woos Drone Industry
How and Where to Invest in the Drone Industry
Tags: Advisor Sharesdrone investingETFinvesting in the drone industryLuca Esposito
Share 0
Tweet
Share
