Investors seeking exposure to the next generation of defense technology now have a new option: Tema ETFs’ recently launched Tema International Defense Innovation ETF (NASDAQ: GDFN), a fund that invests in companies leading innovations in military equipment, aerospace, cybersecurity, and defense engineering.
The September 25 launch occurs amid increasing geopolitical tensions and ballooning global defense budgets. While nations focus on strategic autonomy, conventional defense expenditure is evolving to encompass advanced technology and cybersecurity, presenting new investment opportunities in long-neglected markets for global investors.
The defense market is attracting new attention, and investors are looking for ways to tap into it. The introduction of GDFN was followed by the launch of the Defiance Drone & Modern Warfare ETF (NYSE: JEDI) on September 26, which targets companies that are reshaping both military and commercial applications of drone technology.
GDFN differentiates itself through its pure-play, global strategy. While many broad defense ETFs invest in U.S. companies exclusively, or at least with a focus on U.S. companies, GDFN targets non-U.S. companies that have a direct stake in defense innovation, ranging from cutting-edge weapon systems to future aerospace technologies.
The fund is co-managed with research assistance from a top defense equity boutique and has an expense ratio of 0.68%. Tema points out that this is not only for legacy defense exposure but for investors seeking to benefit from innovation-led growth in the global defense industry.
Why GDFN Matters:
Global Reach: Tap into underpenetrated international defense markets now accelerating with national security imperatives.
Innovation Focus: Invests in companies creating sophisticated weaponry, cybersecurity products, and aerospace technology.
Targeted Defense Exposure: Focused on companies that are directly manufacturing military hardware or spearheading technological breakthroughs.
As defense expenditure increases and security threats evolve, experts believe that investments such as GDFN may resonate with investors seeking to balance thematic exposure with long-term growth potential in a sector influenced by both innovation and geopolitics.
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