ETF Securities Australia targets growth in robotics and automation with global ETF
Sep 14, 2017
SYDNEY, SEPTEMBER 14 – ETF Securities Australia, part of the ETF Securities Group, has created the first exchange traded fund (ETF) in Australia giving investors access to global companies focusing on robotics, automation and artificial intelligence (AI) technologies.
ETFS has teamed up with US based specialist robotics and automation index and research provider ROBO Global to launch the ETFS ROBO Global Robotics and Automation ETF (ASX code: ROBO). ROBO will track the ROBO Global Robotics and Automation Index (RAAI) and is expected to begin trading on the Australian Securities Exchange on September 2017.
“The robotics and automation industries are part of a global megatrend which is expected to outperform the broader market in coming decades,” said Kris Walesby, Head of ETF Securities Australia.
“ROBO Global is the pioneer in this area, having created the first robotics and automation ETF on the NASDAQ in 2013, and continues to work with a strategic advisory team including leading robotics experts.
“We’re excited to be partnering with them to offer local investors a unique opportunity to buy into a spread of transformational technologies which might otherwise be challenging to invest in.”
Research suggests the robotics economy, which was worth an estimated US$64 billion in 2015, could be worth as much as US$1.2 trillion by 2025 as demand for productivity improvements drives increasing industrial, service and consumer applications.
“The world is clearly entering one of the most transformational periods in robotics, automation and artificial intelligence (RAAI),” said Richard Lightbound, the managing partner and chief executive for EMEA at ROBO Global. “Robotics is no longer a niche theme but rather a foundational technology that will soon be applied to virtually all industries and markets.
“The investment opportunity here is significant and if captured correctly the growth prospects from companies within the industry is huge. We believe it is important for investors to ensure their portfolios have early exposure to this theme.”
ROBO will track the performance of 83 stocks from 12 high-growth sub-sectors, focusing on particularly innovative small and mid-caps and avoiding more mature technology names which may lack innovation.
The index captures both technology and application stocks from more than 15 countries, with North American companies accounting for some 43% of the Index as at August 31, followed by 38% in Asia and 19% in Europe.
“Bellwether” stocks, those which earn most of their revenue from RAAI, comprised some 40% of the index as at August 31 while “non-bellwether” stocks, which have a distinct segment of their business in RAAI, comprise the largest proportion at 60%.
To date, there are no Australian stocks in the index although Australia is one of ROBO Global’s coverage markets.
Performance figures for the index show it returned 31.2% over the 12 months to August 31, 18.2% annualised over three years and 25.7% annualised over five years in Australian dollar terms.
The new ETF will have a management fee of 0.69% and will make distributions annually.
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