The Best (and Only) Airline ETF for Q4 2022

Airline company exchange-traded fund (ETF) can provide diversified exposure to the airline industry, including aircraft manufacturers, airline operators, airports and terminal services. The US airline industry includes major carriers like American Airlines Group Inc. (AAL), Delta Air Lines Inc. (DAL), and Southwest Airlines Co. (LUV).

Driven by an increase in leisure and business travel, the industry has seen a strong rebound in demand from pandemic lows. This happened as jet fuel prices rose, driving up costs for carriers. Nevertheless, the recovery has been uneven. Throughout the summer, flight delays and cancellations have plagued the industry, as airlines grapple with staffing issues and other issues affecting logistics. For investors optimistic about the industry’s long-term recovery, an airline ETF offers a way to gain large-scale exposure to this trend.

Key points to remember

  • Airline stocks have underperformed the broader market over the past year.
  • The best (and only) air ETF is JETS.
  • The fund’s top holdings are American Airlines Group Inc., Southwest Airlines Co. and Delta Air Lines Inc.

There is only one option when it comes to ETFs focused on the airline industry: the US Global Jets ETF (JETS). The airline industry has underperformed the S&P 500 over the past year. The benchmark S&P 500 Airlines Industry Index provided a total return of -21.0% compared to the return of -3.7% for the S&P 500, as of August 10, 2022. Note that this index only includes US companies and is not a perfect measure for JETS. , which has a global reach. All data below is as of August 11, 2022.

  • One-year performance: -20.3%
  • Expense ratio: 0.60%
  • Annual dividend yield: 0.04%
  • Three-month average daily volume: 5,520,150
  • Assets under management: $2.7 billion
  • Creation date: April 28, 2015
  • Issuer: US Global Investors

JETS is the only just for the game Airline ETF. As of June 30, 2022, the date of its last technical sheet, this fund allocates approximately 74.5% of its wallet airlines and companies involved in the aeronautics industry (aircraft manufacturers, terminal services companies and airports), with just under 25% invested in companies involved in transport infrastructure, internet, transport and commercial services. Just over three-quarters of the fund’s holdings are US-domiciled securities, with smaller allocations to companies in Europe, Asia and Latin America.

Although JETS is a Multicap ETFsit is weighted mainly towards large cap and mid capitalization companies-small cap companies represent only 4.3% of the portfolio. Overall, its investment strategy is to track the US Global Jets Index, although the fund does not guarantee 100% replication and may invest in securities not included in the index. Below, we take a look at the top 10 holdings of this fund.

Top JETS Holdings
Company name (symbol) Percentage of JETS assets Company Description
American Airlines Group Inc. (AAL) 9.7% National and international carrier
Southwest Airline (LUV) 9.4% low cost carrier
Delta Air Lines Inc. (DAL) 9.2% National and international carrier
United Airlines Holdings Inc. (LAU) 9.0% National and international carrier
Frontier Group Holdings Inc. (ULCC) 4.4% low cost carrier
Spirit Airlines Inc. (TO REGISTER) 3.5% low cost carrier
Alaska Air Group Inc. (ALK) 3.1% National airline
Hawaiian Holdings Inc. (HA) 3.0% low cost carrier
Skywest Inc. (SKYW) 2.8% Regional airline
Air Canada (AC.TO) 2.7% National and international airline based in Canada

The comments, opinions and analyzes expressed herein are for informational purposes only and should not be considered individual investment advice or recommendations to invest in any security or adopt any investment strategy. Although we believe the information provided here is reliable, we do not warrant its accuracy or completeness. The opinions and strategies depicted in our content may not be suitable for all investors. Because market and economic conditions are subject to rapid change, all commentary, opinions and analysis contained in our content are made as of the date of publication and are subject to change without notice. The material is not intended as a comprehensive analysis of every material fact regarding any country, region, market, industry, investment or strategy.

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