Another Electric Vehicle ETF Arrives

Innovation Shares LLC, an upstart issuer of unique, thematic exchange traded funds, launched its second ETF Tuesday with the debut of the Innovation Shares NextGen Vehicles & Technology ETF EKAR.

“EKAR tracks an index designed to give investors exposure to a global basket of stocks that are closely involved in the growth of these markets, placing index constituents in one of four categories based on relevance: 1. battery producers; 2. original equipment manufacturers; 3. suppliers; and 4. semiconductors & software,” according to a statement issued by Innovation Shares.

EKAR debuts at a time of booming global demand for electric and hybrid vehicles.

“The EV revolution is going to hit the car market even harder and faster than BNEF predicted a year ago,” said Bloomberg New Energy Finance. “EVs are on track to accelerate to 54 percent of new car sales by 2040. Tumbling battery prices mean that EVs will have lower lifetime costs, and will be cheaper to buy, than internal combustion engine cars in most countries by 2025-29.”

Competition

EKAR is not the first ETF dedicated to the electric vehicle theme. The KraneShares Electric Vehicles & Future Mobility ETF KARS debuted Jan. 18 and already has over $15.2 million in assets under management.

KARS' underlying index “includes issuers engaged in the electric vehicle production, autonomous driving, shared mobility, lithium and/or copper production, lithium-ion/lead acid batteries, hydrogen fuel cell manufacturing and/or electric infrastructure businesses,” according to KraneShares

EKAR uses artificial intelligence in its stock selection process. The new ETF's index “was constructed utilizing a patent-pending natural language processing algorithm that screens for global stocks that are believed to have a current or future economic interest in the growth of electric and autonomous vehicles,” according to Innovation Shares.

EKAR charges 0.65 percent per year, or $65 on a $10,000 investment.

Blockchain, Too 

Innovation Shares launched its first ETF on Jan. 30, the Innovation Shares NextGen Protocol ETF KOIN. Like EKAR, KOIN uses AI technology.

KOIN is the first ETF "to use artificial intelligence to identify and invest in blockchain innovators and adopters," the issuer said.

KOIN has $4.63 million in assets under management.

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