US Global Jets ETF Review (Oct 2022): How to Buy it In Canada

The global airline industry saw its wings clipped during the pandemic. COVID-19 negatively impacted all sectors of the global economy, but the aviation industry was one of the worst-hit and ill-positioned to recover sectors.

Are you interested in finding a way to invest in the airline industry without having to pick your own stocks?

This US Global Jets ETF (JETS) review will give you a closer look at an investment tool you can use to invest in the global airline industry.

Our Verdict
US Global Jets ETF review
7.5/10Our Score

US Global Jets ETF

Invest In The Global Airline Industry

Invest in a passively managed ETF to gain exposure to a globally diversified portfolio of companies in the airline industry.

What Is US Global Jets ETF?

US Global Jets logo

Established on May 28, 2015, US Global Jets ETF (JETS) is a fund designed to provide you with investment returns by replicating the performance of the US Global Jets Index.

The fund is effectively designed to provide you with exposure to the global airline industry, including operators and manufacturers worldwide.

JETS is currently trading at close to $16.18.

JETS Key Facts

As of Dec 31, 2021:

  • Ticker Symbol: JETS
  • Exchange: New York Stock Exchange
  • Assets Under Management: $2.71 Billion (As of Aug 17, 2022)
  • MER: 0.60%
  • Currency Traded: CAD
  • Registered Accounts Availability: Yes

JETS ETF MER And Fees

The fund comes with a Management Expense Ratio (MER) of 0.60%, making it a relatively higher-cost fund to own in the long run.

US Global Jets ETF Performance And Returns

Performance as of July 31, 2022:

NAV %Market Value %
1 month7.467.27
3 month-17.62-17.52
6 month-16.55-16.59
9 month-19.92-19.82
1 Year-22.22-22.16
3 Year-16.06-16.03
5 Year-9.29-9.28
YTD-16.08-16.07
Since Inception-4.01-4.01
Source: Usglobaletfs.com

What Does US Global Jets ETF Invest In?

US Global Jets ETF is effectively a pure-play on the global airline industry. The fund manager invests in over 50 publicly-traded companies in the global airline industry. It includes airline operators and manufacturers that produce commercial airline jets for the industry.

The fund manager replicates the performance of the US Global Jets Index, an index that uses a smart beta 2.0 strategy to track the global airline industry, and it includes airline companies, airport operators, and any internet media and other services related to airlines.

The index uses a combination of fundamental factors to determine the most efficient airline companies to invest in and offers diversification to companies listed on stock exchanges worldwide.

Investing in JETS ETFs could be considered equivalent to investing in a group of some of the top-performing airlines worldwide.

JETS ETF Asset Allocation

The fund manager states that it invests in a globally diversified portfolio of companies in the airline industry.

However, the bulk of the fund’s asset allocation is towards US-listed securities, that account for 76.08% of its asset allocation. Its second-most significant geographical exposure is to Japanese companies, accounting for 2.91% of its asset allocation. Chinese companies come in third, accounting for 2.81% of the fund’s asset allocation.

United States 76.08%
Japan 2.91%
China 2.81%
Canada 2.59%
Turkey 2.43%
France 1.88%
Spain 1.54%
United Kingdom 1.43%
Germany 1.43%
Brazil 1.26%
Source: Usglobaletfs.com

US Global Jets ETF Fund Industry Breakdown

While JETS ETF is a pure-play on the global airline industry, the fund does diversify into a few other sectors of the global economy. Airlines account for almost 74% of the fund’s asset allocation, but it allocates 13.64% of its assets to the transportation infrastructure industry as well.

JETS ETF also allocates 7.89% of its funds to the internet industry through its exposure to internet media companies related to the airline sector.

Airlines 74.46%
Transportation Infrastructure 13.64%
Internet 7.89%
Transportation 2.14%
Commercial Services 1.06%
Other 0.81%
Source: Usglobaletfs.com

US Global Jets ETF Fund Market Cap Breakdown

JETS ETF allocates over half of its assets under management to large-cap companies, over a third of its assets to mid-cap companies, and over 4% to small-cap companies trading worldwide.

Large Cap (over $10 Billion) 46.07%
Mid Cap ($1-$10 Billion) 49.66%
Small Cap (under $1 Billion) 4.27%
Average Weighted Market Capitalization$14.04 Billion
Source: Usglobaletfs.com

US Global Jets ETF Top Holdings

US Global Jets ETF invests in a globally diversified portfolio of equity securities related to the airline industry, but its top holdings comprise companies listed on North American stock exchanges.

Its top three holdings comprise American Airlines Group, accounting for 9.51% of its weighting, Southwest Airlines, accounting for 9.30%, and Delta Airlines, accounting for 9.30% of its asset allocation.

% Net AssetsNameTickerShares HeldMarket ($)
9.51%AMERICAN AIRLS GROUP INCAAL17,343,039.00257,370,698.76
9.30%SOUTHWEST AIRLS COLUV6,460,544.00251,832,005.12
9.30%DELTA AIR LINES INC DELDAL7,300,511.00251,794,624.39
9.03%UNITED AIRLS HLDGS INCUAL6,253,898.00244,277,255.88
4.28%FRONTIER GROUP HLDGS INCULCC8,379,733.00115,807,910.06
3.45%SPIRIT AIRLS INCSAVE3,851,648.0093,402,464.00
3.06%HAWAIIAN HOLDINGS INCHA5,006,668.0082,860,355.40
3.05%ALASKA AIR GROUP INCALK1,765,317.0082,422,650.73
2.76%SKYWEST INCSKYW3,209,505.0074,781,466.50
2.74%AIR CANADAAC CN4,966,774.0074,069,633.13
Source: Usglobaletfs.com

US Global Jets ETF Sector Weighting

SectorsInvestment %Cat %
 Basic Materials0.004.32
 Consumer Cyclical9.407.56
 Financial Services0.001.69
 Real Estate0.001.30
 Communication Services0.000.87
 Energy0.000.41
 Industrials90.6024.56
 Technology0.0036.96
 Consumer Defensive0.000.86
 Healthcare0.005.83
 Utilities0.0015.63
Source: Morningstar.com

Who Runs Jets ETF?

JETS ETF is a product offered by US Global Investors, a small Texas-based investment firm established in 1968.

The investment management firm became popular when it made a surprising bet on the emerging Canadian cryptocurrency mining stock, HIVE Blockchain, during the first cryptocurrency hype in September 2017.

The investment firm saw incredible success due to its early entry into the speculative and volatile asset class. The fund has since decreased its risk through exposure to the cryptocurrency industry by capturing an US$18.2 million gain on its initial US$2.4 million investment in the space.

JETS ETF is the fund’s pure-play airline-focused fund that has been one of its top-performing funds amid the airline industry’s recovery.

Is US Global Jets ETF A Good Investment?

Determining whether US Global Jets ETF is a good investment depends on your long-term view of the global airline industry.

Historically, airlines have been some of the riskiest businesses to own because the list of major airlines that have ceased operations or relied on bankruptcy protection to reorganize themselves is extensive.

A global pandemic highlighted the challenges facing the aviation industry. Most global markets collapsed with the initial onset of the global health crisis but managed to recover to new all-time highs. Airlines suffered some of the worst losses but without the rapid recovery of the rest of the market.

The ongoing recovery in the airline industry still provides plenty of room for the fund to offer investment returns through capital gains. The airline industry is also a sector that governments worldwide cannot allow to fail, as proven by many major airlines in the past despite their challenges.

If you are hopeful about a global return to relative normalcy in a post-COVID world, JETS ETF could be a viable investment, but it entails a significant degree of capital risk.

I would advise being cautious with how much you choose to invest in the fund if you add JETS ETF to your portfolio.

How To Buy US Global Jets ETF In Canada

The cheapest way to buy ETFs is from discount brokers. My top choices in Canada are:

Readers Choice
Qtrade
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Wealthsimple Trade
Wealthsimple Trade
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Well-Rounded
Questrade
Questrade
  • ETF buys have $0 trading fees
  • Excellent market research tools
  • Most types of registered accounts available

To learn more, check out my full breakdown of the best trading platforms in Canada.

Conclusion

US Global Jets ETF (JETS) is one of the world’s largest ETFs trying to emulate the performance of the global industrials and transportation industries, focusing primarily on airline companies with domestic passenger flight operations.

If you are bullish on the industry’s long-term prospects, there might be no better way to get investment returns from the performance of the airline industry than JETS ETF.

If you want to narrow down your focus on the airline industry and invest in an individual airline stock to your self-directed portfolio, check out my Air Canada stock review to get a better picture of the flag-carrying Canadian airline stock.

Check out my breakdown of the best hydrogen ETFs in Canada if you are interested in an industry with promising long-term upside potential.

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Author Bio - Christopher Liew is a CFA Charterholder with 11 years of finance experience and the creator of Wealthawesome.com. Read about how he quit his 6-figure salary career to travel the world here.

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