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Global X ETFs introduces US infrastructure development fund on ASX

  •  
By Jessica Penny
  •  
3 minute read

The ETF provider is granting Australians access to the strategy followed by the world’s largest US infrastructure development fund.

Global X ETFs has launched the Global X US Infrastructure Development ETF (PAVE) on the ASX, designed to invest in companies that are expected to benefit from increased infrastructure investment in the US.

According to the firm, this includes companies involved in the production of raw materials, heavy equipment, engineering, and construction.

PAVE tracks the Indxx US Infrastructure Development Index.

Chief executive Evan Metcalf highlighted that infrastructure development, which is distinct from investing in infrastructure assets themselves, is “critical for the growth and modernisation of any economy”.

“Within the US, recent legislative acts are directing substantial funding towards infrastructure initiatives, signalling enormous growth potential for companies in this sector,” Metcalf explained.

“This investment opportunity aligns strongly with our core investment thesis of research and innovation. Building on our successful track record of pioneering thematic products in Australia – including recent launches across crypto, technology, and AI – we are excited to introduce this unique infrastructure development ETF to Australian investors.”

Global X head of investment strategy Scott Helfstein added that PAVE is able to capitalise on the US infrastructure sector’s “urgent” need for development

“As recent as 2021, the American Society of Civil Engineers assigned US infrastructure a ‘poor grade’, highlighting significant deficiencies which must be addressed,” Helfstein said.

According to the investment strategist, this has spurred several long-term legislative catalysts, including the Infrastructure Investment and Jobs Act (IIJA) and Creating Helpful Incentives to Produce Semiconductors (CHIPS) Act, amounting to nearly US$2 trillion in federal investment.

“PAVE stands uniquely positioned to capitalise on this momentum, offering a balanced portfolio that strategically leverages these long-term trends. This provides investors with opportunities for both stability and growth, enabling them an opportunity to participate in this transformative period.”

The fund marks the 38th product to join Global X’s Australian line-up, following the recent launches of several thematic ETFs including the Global X Cybersecurity ETF (ASX: BUGG) in September and Global X Artificial Intelligence ETF (ASX: GXAI) earlier this year.

In May, the Australian ETF industry witnessed the end of a six-month hot streak as assets dipped for the first time since October 2023.

According to Betashares’ latest Australian ETF review, ETF industry assets fell 0.9 per cent month-on-month for a total monthly market cap decline of $1.7 billion in April.

The best-performing funds for April were short funds and energy transition metals exposures, such as copper.