Back to top

Image: Bigstock

ETFs to Invest in SPACs and 5G

Read MoreHide Full Article

  • (1:15) - Why Is The SPAC Market Booming Right Now?
  • (8:50) - Defiance NextGen SPAC Derived ETF: SPAK
  • (15:00) - How To Avoid Risky Companies Within The Industry
  • (18:10) - Defiance NextGen Connectivity ETF: FIVG
  • (22:00) - Episode Roundup: Podcast@Zacks.com

 

In this episode of ETF Spotlight, I speak with Paul Dellaquila, Global Head of ETFs at Defiance, about SPACs and 5G technology.

2020 could be one of the busiest years for IPOs on record.Investors’ voracious appetite for fast growing companies and abundant liquidity are fueling this boom. Normally companies use the traditional IPO process or direct listing to go public. Another route to a public listing is through a SPAC (Special Purpose Acquisition Company).

SPACs, also known as blank-cheque companies, raise money from investors, solely to find a private company and take it public. 165 SPACs have raised $61.5 billion in the US this year so far, per SPAC Research. Several high-profile investors and public figures, including Bill Ackman and Chamath Palihapitiya, have launched their SPACs.

The Defiance NextGen SPAC IPO ETF (SPAK - Free Report) is the first ETF to provide exposure to SPACs and the stocks in which they invest. The ETF allows investors to invest in a diversified basket of most liquid SPAC IPOs since picking the winners among individual SPACs can be very difficult. 80% of SPAK’s portfolio is in companies that have gone public through SPACs and remaining 20% is in SPACs that are looking for acquisitions.

Digital sports entertainment and gaming company DraftKings (DKNG - Free Report) and space tourism company Virgin Galactic (SPCE - Free Report) are among its top holdings.

We also talk about the Defiance Next Gen Connectivity ETF (FIVG - Free Report) , which holds companies involved in research, development and usage of 5G technology. With Apple (AAPL - Free Report) rolling out its new 5G-enabled iPhones recently, this ETF has seen renewed investor interest. Its top holdings include Qualcomm (QCOM - Free Report) , Xilinx (XLNX - Free Report) and Skyworks (SWKS - Free Report) . (Please see: 5G ETFs: Invest in the Next Generation Wireless Technology)

Tune into the podcast to learn more about these ETFs. Make sure to be on the lookout for the next edition of ETF Spotlight! If you have any comments or questions, please email podcast@zacks.com.

Want key ETF info delivered straight to your inbox?

Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>