Themes adds US infrastructure ETF

Themes ETFs has introduced a new thematic equity ETF, offering investors passive exposure to US infrastructure companies.

The Themes US Infrastructure ETF (HWAY US) has been listed on Nasdaq, featuring a competitive expense ratio of 0.29%, almost half lower compared to the 0.52% average for ETFs in the US infrastructure category.

Investing in US infrastructure offers several compelling advantages, including stable, long-term cash flows, making it attractive for income-focused investors. Assets such as utilities, transportation networks, and toll roads generate consistent revenue through regulated pricing or long-term contracts.

According to Themes, the sector is also set for substantial growth, driven by significant government support, including the $1 trillion allocation under the Bipartisan Infrastructure Law, which is expected to fuel demand for infrastructure projects through 2026.

Additionally, infrastructure investments can serve as an inflation hedge, as many assets can pass increased costs onto consumers, preserving their real value. With typically low correlations to traditional asset classes like stocks and bonds, infrastructure investments also provide valuable diversification within a portfolio.

Methodology

The ETF tracks the Solactive United States Infrastructure Index, which selects companies listed and headquartered in the US with a minimum free float market capitalization of $100 million and an average daily trading volume exceeding $1 million.

The methodology screens for companies primarily involved in building materials, construction, engineering services, and logistics. The index includes the 100 largest eligible firms, weighted by float-adjusted market capitalization, with a maximum cap of 4.5% per security. Reconstitution and rebalancing occur semi-annually.

The resulting index allocates approximately 80% to the industrials sector and 15% to materials. The largest holdings, each comprising 4% to 5% of the total exposure, include Union Pacific, Norfolk Southern, Deere & Co., Caterpillar, CSX, Emerson Electric, and United Rentals, all of which are key players in the US infrastructure sector with significant involvement in transportation, heavy machinery, and industrial equipment.