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Guest: Andrew Chanin; Topics: Global space Exchange-Traded Fund (ET), commercial space investing, aerospace opportunities, exchange-traded products, mutual funds, space investment influencing issues.
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We welcomed Andrew Chanin of ProcureAM to the program for a one segment 64 minute in-depth discussion about exchange-traded products and specifically their global space Exchange-Traded Fundy, The Procure Space ETF. Andrew introduced us to exchange-traded products and then upon request, compared an ETF (exchange-traded fund) to a typical mutual fund. This comparison discussion should answer many structural questions you might have about ETF's. Note that Andrew said many ETF's were theme focused including the ETF we discussed today, the Procure Space ETF.
Andrew then introduced us to the Procure Space ETF. The global aerospace fund has 30 companies in it. We mentioned the top ten on air. Andrew also talked about the need to have a specific percentage of revenue coming from space or space related industries. Don't miss this important part of our discussion. He was asked about front end, real end and other fees, the market price, the ticker symbol which is UFO and the NYSE electronic market. Other aspects of this space ETF included pure plays with 80% of revenue from space but also diversification where a lower percentage might come from space. Listen to his explanation for this and how the fund is managed and grown.
Listeners sent in emails asking about private companies, start-ups and SpaceX. To be included in an ETF, a company has to be listed on a public exchange but this includes international exchanges, not just those in the U.S. Other listeners wanted to know how the ETF management view space, trends and industry projections. To answer these questions, Andrew referenced the Bank of America and Morgan Stanley space reports. There have been other industrial commercial space industry reports including one from Goldman Sachs. Later in the program, we talked about commercial space influencing factors that have the potential to impact a global space ETF.
Listener Blake asked a question about Virgin Galactic (VG) and the ETF. You might be surprised to learn that VG might be doing a merger with a SPAC which would result in a type of end run around some public offering rules allowing it to become a legal public company with possible inclusion on the space focused ETF. Don't miss all of what was said about the Special Purpose Acquisition Companies (SPAC) and how it might related to VG.
Listeners wanted to know if the Chinese commercial companies now operating or companies in Russia could be part of an ETF. Don't miss what he said in response to these questions. You might be surprised. Another set of questions came up asking how the ETF assesses and deals with both political and regulatory risks as these risks are not generally associated with most terrestrial businesses in the developed world.
One listener asked for the country makeup of the Procure Space ETF. Andrew said that two-thirds of the companies were here in the US. France was next, then the UK followed by Japan and others. Some of the other topics that came up included the role of AI in commercial space and wanting to be on an ETF as a motivating factor to launch an IPO.
Andrew was asked about how the role of human spaceflight (HSF), returning to the Moon. and going to Mars would impact the ETF. Here Andrew talked about HSF as part of a bigger space operation with organizations such as Boeing and how that element might contribute to the value of the company in the ETF. Andrew went into these relationships in detail so be sure to listen to all of what he said. Again, your blog comments on these topics would be most welcome.
We talked about overall industry growth, the development of tech such as 5G, smallsats, cubesat constellations and much more. Once again Andrew showed how these components of aerospace companies contributed to their space value and growth for the ETF. He mentioned a few such companies such as Boeing and Airbus as examples.
Before the end of our discussion, Big Pharma came up but was not yet on the global list of companies. Following the Big Pharma comments, Andrew identified some of the issues that concern investors about the developing space economy. Don't miss hearing what our guest said on this topic.
Please post your comments/questions on TSS blog for this show. You can reach Andrew through me or the ProcureAM website.