Houston, we have liftoff.
State Street is starting the first ETF that invests in outer space, beating at least two rivals to launch. The SPDR Kensho Final Frontiers ETF (XKFF) will start trading on Tuesday, according to a company statement. The Boston-based money manager is also listing a clean power fund, and the cheapest ETF focused on automation, robotics and other ‘‘new economies.’’
It’s all part of the third-largest U.S. ETF issuer’s plan to push into so-called thematics, strategies that look beyond industry categories or investment factors and instead focus on broad concepts such as artificial intelligence, self-driving cars or the Internet of Things. To succeed you have to find a way to stand out amid stiff competition from the likes of BlackRock, Goldman Sachs Group and Deutsche Bank’s DWS.
“The first mover advantage is quite clear,” said Matthew Bartolini, head of Americas research for State Street’s ETF business. “But you don’t want to be first and cut corners. Being first with a real actionable product, with rigor behind it, is something that’s even more important.”
This isn’t State Street’s first venture into thematics. It started three ETFs in December 2017, charging $4.50 for every $1,000 invested. That’s what its final frontiers and clean power ones will charge. But the SPDR Kensho New Economies Composite ETF (KOMP) will cost just $2, undercutting other similar funds.
-
The company is evaluating ways to package both its quantitative and active strategies into the funds, according to a person familiar with the matter.
September 25 -
To encourage a budding relationship with younger clients, firms must provide new offerings and more guidance about how to invest, Schwab says.
September 18 -
Clients will flock to digital advice, but conditions favor incumbent firms, a study found.
September 18
Goldman Sachs is also planning a handful of thematic funds to tap interest in this area, regulatory filings show. Its five funds will include those with names touting a “manufacturing revolution” and “data-driven world.”
For a pure play on space, however, investors will have to wait. State Street’s Final Frontiers fund will also invest in deep sea exploration. Two other funds — the Procure Space ETF and DWS’s Xtrackers Indxx Space & Exploration ETF — are currently seeking approval from the SEC to offer space-focused strategies.
Only time will tell if they can post returns that are out of this world.
