Space-focused ETFs are heading to the stars ahead of the much-anticipated IPO by Elon Musk’s SpaceX.
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Space ETFs Attract the Cash
According to figures from Morningstar Direct, space-related ETFs have attracted $1.3 billion in new cash over the last month pushing total assets under management in the sector to $3.3 billion.
The popularity has been driven by the excitement around a SpaceX IPO and its dreams of building data centers in space and to head to and colonize Mars, as well as the success of the Artemis II mission. In short, we could be on the verge of huge growth in the space economy.
“We tend to see this happen whenever something new and shiny appears on the scene,” said Bryan Armour, an ETF analyst at Morningstar, referring to the proliferation of new products.
Until this year, investors who wanted to put their money into a space ETF had only a single option: the Procure Space ETF (UFO), launched in 2019.
UFO provides exposure to a carefully curated portfolio of global companies that are leading the charge in space innovation. This includes firms involved in manufacturing spacecraft, launching satellites, and developing cutting-edge space-based technologies.
Space ETFs Go for Launch
But in the last three months, it has been joined by six more funds. One of them, the $1.27 billion Tema Space Innovators ETF (NASA), has accumulated more in assets in the seven weeks since its launch than the $972 million UFO has in the seven years since its debut, according to data from Morningstar Direct.
NASA invests in companies across the full value chain of space activity—from satellite manufacturers and launch providers to ground infrastructure, propulsion systems, sensors, robotics, and data-analytics firms that enable space-enabled services.
The most recent space ETFs to launch are the VanEck Space ETF (WARP) and the Corgi Space and Satellite Communications ETF (DIPR) which debuted only a day apart at the beginning of May and together have already pulled in $13.6 million in assets.
WARP tracks an index of companies across the full space value chain—from satellite manufacturers and component suppliers to launch-service providers, orbital infrastructure and in‑space servicing firms, plus related ground-segment equipment, satellite communications and data-analytics businesses.
DIPR focuses on firms involved in satellite manufacturing and operators, launch services, ground stations and antennas, space-enabled network services (including broadband, backhaul and IoT connectivity), Earth observation and data analytics, and key component and subsystem suppliers
“We’d been monitoring this for a while but it is only in the last few months that we have felt there was an inflection point; that there would be enough diverse but pure-play companies for this kind of thematic ETF to work,” said Nick Frasse, product manager at VanEck, who said SpaceX would bring other companies along with it into the space economy. “I think everyone is seeing the writing on the wall, that this is a big growth story.”
Space ETFs Comparison
Let’s look at how the Space ETFs are performing with our TipRanks comparison tool. The UFO share price has grown 52.55% in the year-to-date, with NASA up 35%, WARP up 13% and DIPR up 17%.
