Thematic ASX exchange-traded funds (ETFs) provide an easy way to hitch your investment returns to major global megatrends.
In this article, we check out 3 ASX ETFs doing exactly that, and look at how they're currently performing for Aussie investors.
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Video Games and Esports ETF (ASX: GAME)
The GAME ETF is $20.59 per unit, down 0.6% today but up 79% over the past 12 months.
GAME ETF seeks to capitalise on the rising popularity of gaming, with Statista data showing there are 2.7 billion gamers today.
The GAME ETF is invested in 40 shares and tracks the Nasdaq CTA Global Video Games & Esports Index.
Currently, the top holdings are NetEase, Roblox Corp, and Tencent.
Top industry allocations are interactive home entertainment (71%), application software (15%), and interactive media and services (8%).
Geographic exposure entails US 40%, Japan 31%, China 19%, and South Korea 6%.
The GAME ETF pays dividends (called 'distributions' with ETFs) once per year.
The management fee is 0.57% per annum.
Since its inception in February 2022, this ASX ETF has delivered an average annual return of 16%.
Vaneck Global Defence ETF (ASX: DFND)
The DFND ETF is $40.51 per unit, down 0.3% today but up 91% over the past 12 months.
DFND ETF is a relatively new thematic ETF that was launched just over a year ago.
It seeks to capitalise on the global defence spending theme via a portfolio of listed global military and defence companies.
Amid escalating tensions worldwide, the Stockholm International Peace and Research Institute says 2024 saw the largest annual increase in defence spending since the end of the Cold War.
Exemplifying this trend, the 32 nations in NATO committed to more than doubling their defence spending from 2% to 5% of GDP over 10 years just a few months ago.
This ASX ETF holds 29 shares and tracks the MarketVector Global Defence Industry (AUD) Index.
The top five holdings are Thales SA, RTX Corp, Leonardo SpA, Palantir Technologies Inc, and Hanwha Aerospace Co Ltd.
Top sector allocations are aerospace and defence (71%), professional services (15%), software (8%), and machinery (5%).
The geographic allocation is 49% US, 12% South Korea, 10% France, 8% Italy, 6% Sweden, and 5% Germany.
The ASX ETF pays distributions once per year.
The management fee is 0.65% per annum.
Since its inception in September 2024, DFND ETF's total returns have averaged 92% per annum.
Global Cybersecurity ETF (ASX: HACK)
The HACK ETF is $15.45 per unit, down 0.25% on Tuesday but up 29% over the past 12 months.
The HACK ETF seeks to capitalise on rocketing demand for cybersecurity services across the world.
Cybersecurity is enormously important amid increasing data breaches, scams, and cyber hacks.
Millions of Australians were affected by cyber attacks on Optus, Qantas Airways Ltd (ASX: QAN), and Medibank Private Ltd (ASX: MPL).
Just today, we learned of an email scam involving the University of Western Sydney.
HACK provides exposure to 32 shares and tracks the Nasdaq Consumer Technology Association Cybersecurity Index.
Currently, the top holdings are Broadcom, Cisco Systems, and Palo Alto Networks.
Top allocations are systems software companies (44%), communications equipment (13%), and internet services and infrastructure (11%).
The geographic exposure is 81% US, 7% India, 3.5% Israel, and 3% France.
The ASX ETF pays distributions twice per year in January and July.
The management fee is 0.57% per annum, and there is a 0.1% expenses ratio.
Since its inception in August 2016, the HACK ETF has delivered an average total annual return of 18%.
