Airlines ETF Monthly Report: Key Takeaways
The U.K. is now the hottest destination among European travellers seeking an escape, after years of restricted movement, reports Bloomberg.[1] According to Mastercard Economics Institute report on this year’s travel trends, Britain has leapfrogged Spain as the top haunt for European travellers as of March. [2]
The Biden Administration dropped the COVID-19 testing requirement for inbound air travellers from abroad on Sunday, June 12, reports CNBC, ending one of the longest-running travel restrictions of the pandemic. Airlines and others in the travel industry had repeatedly pushed the administration to drop the requirement, the article continues, arguing it was hurting demand for international trips. [3]
On June 22, the International Air Transport Association (IATA) released its Annual Review 2022 report, highlighting high-level industry trends over the last two years. The report highlights that industry losses are expected to reduce to $9.7 billion in 2022, down from $42.1 billion in 2021. This is an enormous improvement from losses of $137.7 billion in 2020. [4]
Macro Outlook
On June 9, the International Air Transport Association (IATA) announced that air travel resumed its strong recovery trend in April 2022, according to the IATA website, despite the war in Ukraine and travel restrictions in China. Total demand for air travel in April 2022 was up 78.7% compared to April 2021 and slightly ahead of March 2022’s 76.0% year-over-year increase. [5]
Internet searches are showing sky-high airfares for many airline routes this summer, reports Bloomberg, yet travellers with wanderlust are opting to stomach the higher costs after being grounded for so long. “The demand is off the charts,” Delta Air Lines CEO Ed Bastian said, noting that fares this summer may be 30% higher than pre-pandemic levels. [6]
On June 20, JetBlue Airways announced that it has sweetened its takeover offer for Spirit Airlines, reports Reuters, to $33.50 per share. The bid comes in hopes that the ultra-low-cost carrier will accept the offer over rival Frontier Airlines’ proposal. JetBlue’s latest bid represents a 68% premium to Frontier’s cash and stock offer. The takeover (by Frontier or JetBlue) would create the fifth-largest U.S. airline, the article continues. [7]
Please remember that past performance is not indicative of future performance, and when you invest in ETFs, your capital is at risk.
Airlines ETF Performance Table (As of 30.06.2022)
|
|
1M
|
3M
|
6M
|
YTD
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12M
|
SI
|
|
U.S. Global Jets UCITS ETF (Acc)
|
-19.70%
|
-24.43%
|
-22.01%
|
-22.01%
|
-31.68%
|
-35.98%
|
|
U.S. Global Jets Index
|
-19.63%
|
-24.25%
|
-21.26%
|
-21.26%
|
-31.10%
|
-35.45%
|
Please note that all performance figures are showing net data. Source: Bloomberg / HANetf. Data as of 30/06/2022. Performance before inception is based on back tested data. Back tested data does not represent actual performance and should not be interpreted as an indication of actual or future performance. Past performance for the index is in USD. Past performance is not an indicator for future results and should not be the sole factor of consideration when selecting a product. Investors should read the prospectus of the Issuer (“Prospectus”) before investing and should refer to the section of the Prospectus entitled ‘Risk Factors’ for further details of risks associated with an investment in this product.
Learn more about the U.S. Global Jets UCITS ETF