Defiance unveils ‘pure-play’ electric vehicles ETF

Jun 27th, 2023 | By | Category: Equities

Defiance ETFs has launched a new thematic equity ETF providing targeted exposure to electric vehicle manufacturers.

Sylvia Jablonski, CEO of Defiance ETFs.

Sylvia Jablonski, CEO of Defiance ETFs.

The Defiance Pure Electric Vehicle ETF (EVXX US) has been listed on NYSE Arca with an expense ratio of 0.68%.

Defiance notes that many countries have already begun to outpace early estimates for EV adoption – China, for example, has already surpassed its 20% EV share target, two years ahead of its 2025 target date.

Furthermore, EV sales are expected to grow another 35% this year to reach 14 million units after a record-breaking 2022 of more than 10 million EV units sold, while the US government alone is set to invest $15 billion in EV infrastructure.

While there are several ETFs already delivering access to the electric vehicles investment theme, Defiance highlights that EVXX is unique due to its focused, highly concentrated strategy.

The fund is linked to the Solactive Pure US Electric Vehicle Index which consists of an equally weighted allocation to just the five largest US-listed ‘Alternative Energy Car Manufacturers’, according to the Revere Business Industry Classification Standard (RBICS).

As of 13 June, the companies forming the index were Tesla (25.4%), Li Auto (21.2%), NIO (18.1%), Rivian Automotive (18.3%), and XPeng (17.0%).

Sylvia Jablonski, Chief Executive Officer of Defiance ETFs, said: “We continue to hear from investors that there is demand for a pure EV ETF which captures this emerging megatrend without diluting the purity of the product with traditional semiconductor and auto stocks, which have little or no EV sales. Defiance is thrilled to be bringing EVXX to market to fill that void.”

The ETF tracks its index indirectly using swap agreements with major global financial institutions. The swap agreements may have a term ranging from a day to more than one year.

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