Global X has announced it is bringing its Defence Tech ETF, under the ASX ticker DTEC, to Australian shores.
The offering, which has been listed on the NYSE Arca since 2023, under the ticker SHLD, holds over US$540 million in net assets and seeks to invest in companies positioned to benefit from the increased adoption and utilisation of defence technology.
This includes companies that build hardware like robotics and aircrafts for defence applications, manage cyber security systems, and utilise big data and artificial intelligence.
In a market update on Tuesday, Global X explained DTEC will provide Australian investors with the same exposure to companies “at the forefront of defence innovation”.
“As global defence spending increases and security concerns shift towards more technology-driven solutions, DTEC captures the crucial sectors driving the future of defence including AI, drones and cyber security,” the fund manager said.
It will mark Global X’s 41st offering in the local market, following the launch of Global X S&P World Ex-Australia GARP ETF (ASX: GARP) just last week.
The announcement also comes one month after investment manager VanEck launched its own defence ETF (ASX: DFND), which is understood to be the first defence ETF on the ASX.
Unveiling the fund, Arian Neiron, chief executive and managing director of VanEck Asia-Pacific, noted that the world has unfortunately shifted from the days of “celebrating the peace dividend”.
“Where countries used to extol the economic benefits of reduced defence spending, they’re ramping up military expenditure,” he said.
“Investors are adapting to the likely reality that this will keep rising in the years ahead.”
Previously, a 2023 report by the Stockholm International Peace Research Institute showed global military expenditure had grown 7 per cent to US$2.43 trillion, the steepest annual rise since 2009.
By 2030, the industry is expected to grow nearly 40 per cent to US$3.1 trillion.
