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ETFs to Fly High With Surge in Thanksgiving Travel
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A higher number of Americans are gearing up for Thanksgiving travel by road or air this time encouraged by a wider reach of vaccinations, lifting of pandemic restrictions and increasing consumer confidence.
Increase in travel demand should boost revenues and profitability for the travel and tourism industry, thereby leading to higher share prices. Investors shouldn’t miss this opportunity and could tap this trend through ETFs that stand to profit big time from the upbeat Thanksgiving travel trend. As such, SonicShares Airlines, Hotels, Cruise Lines ETF , U.S. Global Jets ETF (JETS - Free Report) , AdvisorShares Hotel ETF (BEDZ - Free Report) , ETFMG Travel Tech ETF (AWAY - Free Report) and ALPS Global Travel Beneficiaries ETF (JRNY - Free Report) look intriguing picks.
Solid Travel Trends
According to travel service provider American Automobile Association (AAA), Thanksgiving holiday travel is expected to rebound nearly to the pre-pandemic levels. More than 53.4 million Americans will travel this Thanksgiving weekend (Nov 24-Nov 28), up 13% from last year and the highest single-year increase since 2005. This will bring travel volumes within 5% of the pre-pandemic levels in 2019, with air travel almost completely recovering from its dramatic fall during the pandemic.
About 48.3 million (up 8% from the last year) will go on road trips, 4.2 million (up 80%) will fly, and the remaining 1 million (up 262%) will travel by train, bus or cruise. The United States lifted the travel restrictions and reopened to fully vaccinated international travelers early this month, cheering up travelers making plans for this holiday season (read: Rally in Travel and Tourism ETFs Set to Continue).
Although 90% of Americans are expected to hit the roads, motorists have to pay the highest gas prices in over seven years, per GasBuddy. This is especially true as gasoline prices are surging this year and the national average price of gasoline is projected to hit $3.35 per gallon on Thanksgiving Day. Daily car rental rates have also increased 4% from last Thanksgiving to $98. Additionally, mid-range hotel rates have increased about 39%, with average nightly rates ranging between $137 and $172 for AAA Approved Hotels.
Another report from the U.S. airlines group, Airlines for America (A4A), shows that 28.5 million passengers will travel during the 12-day Thanksgiving air-travel period, up 3% from 2016. The 2.38 million passengers per day expected to take to the skies represent an increase of 69,000 from the 2016 Thanksgiving travel period. Airlines are accommodating this increase in demand by adding 86,000 more seats in the marketplace each day, up 3.2% over 2016.
According to the Transportation Security Administration, about 2 million people a day are projected to fly from Nov 19 through Nov 28, with the potential for some days to exceed that average dramatically. Passenger traffic for the last five days of the period would be just 9% below 2019, before the pandemic hit.
Let’s delve deeper into the above-mentioned ETFs:
SonicShares Airlines, Hotels, Cruise Lines ETF
SonicShares Airlines, Hotels, Cruise Lines ETF provides exposure to a global portfolio of companies focused on what many investors consider to be the “core” of business and leisure travel: the airline, hotel and cruise line industries. It tracks the Solactive Airlines, Hotels, Cruise Lines Index, holding 60 stocks in its basket.
SonicShares Airlines, Hotels, Cruise Lines ETF was launched in the space in May and has accumulated $7.4 million in its asset base so far. TRYP trades in an average daily volume of 53,000 shares and charges 75 bps in annual fees.
U.S. Global Jets ETF provides exposure to the global airline industry, including airline operators and manufacturers from all over the world by tracking the U.S. Global Jets Index. The product holds 51 securities and charges 60 bps in annual fees (read: Earnings or Oil: What Will Impact the Airlines ETF Ahead?).
U.S. Global Jets ETF has gathered $3.6 billion in its asset base while sees a heavy trading volume of nearly 7.2 million shares a day. JETS has a Zacks ETF Rank #3 (Hold) with a High risk outlook.
AdvisorShares Hotel ETF has also newly debuted in the space and has accumulated $9.8 million in its asset base since late April. BEDZ is the actively managed and only ETF investing exclusively in the global hotel and travel-related services. AdvisorShares Hotel ETF holds 31 stocks in its basket that are pretty spread across components.
AdvisorShares Hotel ETF charges 79 bps in annual fees and trades in an average daily volume of 11,000 shares.
ETFMG Travel Tech ETF is the first ETF that offers direct access to the technology-focused global travel and tourism industry. It follows the Prime Travel Technology Index, charging investors 75 bps in annual fees. ETFMG Travel Tech ETF holds 36 stocks in its basket with travel bookings & reservations companies accounting for 51.9% of assets, followed by a 17.5% share in travel advice firms (read: 5 ETFs to Binge on This Thanksgiving Week for Solid Gains).
ETFMG Travel Tech ETF has accumulated $323.9 million in its asset base and trades in an average daily volume of 282,000 shares.
ALPS Global Travel Beneficiaries ETF, which was launched on Sep 7, provides diversified exposure to the global travel industry by tracking the S-Network Global Travel Index. The fund invests in 76 companies engaged in booking and rental agencies, airlines and airport services, hotels, casinos, and cruise lines, along with travel-related companies identified through machine learning algorithms, such as luxury retail, entertainment, leisure, food and beverage, and payment processing vendors.
ALPS Global Travel Beneficiaries ETF has accumulated $8.3 million in its asset base and charges 65 bps in annual fees. JRNY trades in an average daily volume of 3,000 shares.
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ETFs to Fly High With Surge in Thanksgiving Travel
A higher number of Americans are gearing up for Thanksgiving travel by road or air this time encouraged by a wider reach of vaccinations, lifting of pandemic restrictions and increasing consumer confidence.
Increase in travel demand should boost revenues and profitability for the travel and tourism industry, thereby leading to higher share prices. Investors shouldn’t miss this opportunity and could tap this trend through ETFs that stand to profit big time from the upbeat Thanksgiving travel trend. As such, SonicShares Airlines, Hotels, Cruise Lines ETF , U.S. Global Jets ETF (JETS - Free Report) , AdvisorShares Hotel ETF (BEDZ - Free Report) , ETFMG Travel Tech ETF (AWAY - Free Report) and ALPS Global Travel Beneficiaries ETF (JRNY - Free Report) look intriguing picks.
Solid Travel Trends
According to travel service provider American Automobile Association (AAA), Thanksgiving holiday travel is expected to rebound nearly to the pre-pandemic levels. More than 53.4 million Americans will travel this Thanksgiving weekend (Nov 24-Nov 28), up 13% from last year and the highest single-year increase since 2005. This will bring travel volumes within 5% of the pre-pandemic levels in 2019, with air travel almost completely recovering from its dramatic fall during the pandemic.
About 48.3 million (up 8% from the last year) will go on road trips, 4.2 million (up 80%) will fly, and the remaining 1 million (up 262%) will travel by train, bus or cruise. The United States lifted the travel restrictions and reopened to fully vaccinated international travelers early this month, cheering up travelers making plans for this holiday season (read: Rally in Travel and Tourism ETFs Set to Continue).
Although 90% of Americans are expected to hit the roads, motorists have to pay the highest gas prices in over seven years, per GasBuddy. This is especially true as gasoline prices are surging this year and the national average price of gasoline is projected to hit $3.35 per gallon on Thanksgiving Day. Daily car rental rates have also increased 4% from last Thanksgiving to $98. Additionally, mid-range hotel rates have increased about 39%, with average nightly rates ranging between $137 and $172 for AAA Approved Hotels.
Another report from the U.S. airlines group, Airlines for America (A4A), shows that 28.5 million passengers will travel during the 12-day Thanksgiving air-travel period, up 3% from 2016. The 2.38 million passengers per day expected to take to the skies represent an increase of 69,000 from the 2016 Thanksgiving travel period. Airlines are accommodating this increase in demand by adding 86,000 more seats in the marketplace each day, up 3.2% over 2016.
According to the Transportation Security Administration, about 2 million people a day are projected to fly from Nov 19 through Nov 28, with the potential for some days to exceed that average dramatically. Passenger traffic for the last five days of the period would be just 9% below 2019, before the pandemic hit.
Let’s delve deeper into the above-mentioned ETFs:
SonicShares Airlines, Hotels, Cruise Lines ETF
SonicShares Airlines, Hotels, Cruise Lines ETF provides exposure to a global portfolio of companies focused on what many investors consider to be the “core” of business and leisure travel: the airline, hotel and cruise line industries. It tracks the Solactive Airlines, Hotels, Cruise Lines Index, holding 60 stocks in its basket.
SonicShares Airlines, Hotels, Cruise Lines ETF was launched in the space in May and has accumulated $7.4 million in its asset base so far. TRYP trades in an average daily volume of 53,000 shares and charges 75 bps in annual fees.
U.S. Global Jets ETF (JETS - Free Report)
U.S. Global Jets ETF provides exposure to the global airline industry, including airline operators and manufacturers from all over the world by tracking the U.S. Global Jets Index. The product holds 51 securities and charges 60 bps in annual fees (read: Earnings or Oil: What Will Impact the Airlines ETF Ahead?).
U.S. Global Jets ETF has gathered $3.6 billion in its asset base while sees a heavy trading volume of nearly 7.2 million shares a day. JETS has a Zacks ETF Rank #3 (Hold) with a High risk outlook.
AdvisorShares Hotel ETF (BEDZ - Free Report)
AdvisorShares Hotel ETF has also newly debuted in the space and has accumulated $9.8 million in its asset base since late April. BEDZ is the actively managed and only ETF investing exclusively in the global hotel and travel-related services. AdvisorShares Hotel ETF holds 31 stocks in its basket that are pretty spread across components.
AdvisorShares Hotel ETF charges 79 bps in annual fees and trades in an average daily volume of 11,000 shares.
ETFMG Travel Tech ETF (AWAY - Free Report)
ETFMG Travel Tech ETF is the first ETF that offers direct access to the technology-focused global travel and tourism industry. It follows the Prime Travel Technology Index, charging investors 75 bps in annual fees. ETFMG Travel Tech ETF holds 36 stocks in its basket with travel bookings & reservations companies accounting for 51.9% of assets, followed by a 17.5% share in travel advice firms (read: 5 ETFs to Binge on This Thanksgiving Week for Solid Gains).
ETFMG Travel Tech ETF has accumulated $323.9 million in its asset base and trades in an average daily volume of 282,000 shares.
ALPS Global Travel Beneficiaries ETF (JRNY - Free Report)
ALPS Global Travel Beneficiaries ETF, which was launched on Sep 7, provides diversified exposure to the global travel industry by tracking the S-Network Global Travel Index. The fund invests in 76 companies engaged in booking and rental agencies, airlines and airport services, hotels, casinos, and cruise lines, along with travel-related companies identified through machine learning algorithms, such as luxury retail, entertainment, leisure, food and beverage, and payment processing vendors.
ALPS Global Travel Beneficiaries ETF has accumulated $8.3 million in its asset base and charges 65 bps in annual fees. JRNY trades in an average daily volume of 3,000 shares.