ETF Securities, a leading provider of exchange-traded funds, has partnered with Robo-Stox, a creator of indices tracking the robotics and automation industry, to launch the Robo-Stox Robotics and Automation GO UCITS ETF (ROBO).
ETF Securities has partnered with Robo-Stox to launch Europe’s first ETF to provide dedicated exposure to the global robotics and automation market.
Listed on the London Stock Exchange, the ETF is Europe’s first to provide dedicated exposure to the global robotics and automation mega-trend.
After the rise of the internet age, rapid advances in technology such as machine vision, motion sensors and image and voice recognition are enabling robots to perform increasingly sophisticated and delicate knowledge-based work. This widens their application to an incredible array of industries and applications, namely across sectors such as manufacturing, services, healthcare and exploration, in addition to the automotive industry where penetration of robotics is more advanced.
As labour costs rise and the price of automation falls, companies are approaching the tipping point for the rapid adoption of robotic technologies. Aging populations and shrinking workforces will accelerate this trend. There has been a sharp rise in robotics production and sales: In the last 10 years, the worldwide annual supply of industrial robots more than doubled from 80,000 units in 2003 to more than 170,000 in 2013.
For investors, the growth prospects of the robotics and automation sector are compelling. The newly launched ETF enables investors to track the sector in a highly diversified and dynamic way, ensuring it evolves with new growth trends as they emerge.
The ETF’s underlying index, the Robo-Stox Global Robotics and Automation UCITS Index, currently comprises of 82 constituent companies involved in the global robotics and automation industry, spanning the world’s major regions. Within the index, a two-tiered, equal-weighting approach captures robotic ‘pure plays’ (so called “bellwethers”, currently 40% of the index) and stocks with robotic segments (“non-bellwethers”, currently 60% of the index). Index constituents are all listed on a recognised global stock exchange and satisfy minimum criteria relating to market capitalisation and average daily value traded. Constituents are reviewed and rebalanced on a quarterly basis.
The index has appreciated more than four-fold, achieving an annualised rate of return of over 18% over the past ten years, substantially outperforming most major equity, tech and other asset class benchmarks. The diversified nature of the index has contributed to its relatively low volatility over time, despite its high growth performance.
Commenting on the launch, Howie Li, Co-Head of Canvas, ETF Securities, said: “We are delighted to partner with Robo-Stox, the recognised leader in robotics and automation investment research, to launch this innovative ETF in an exciting growth sector that no other industry classification body has been able to separately identify to date. This investment solution will provide investors with a global portfolio of listed robotics and automation companies that capture activity from both emerging and established organisations that are highly diversified across countries, sectors and market capitalisation.”
Richard Lightbound, Partner & CEO, Robo-Stox Partners, added: “We believe the world is in the early stages of a transformational new economic era, driven by the increasing adoption of sophisticated robotics and automation technologies across all aspects of industry and day-to-day life. ETF Securities’ unique CANVAS platform and the team’s experience in bringing innovative investment products to market will help us pioneer European investment in this fast growing sector.”
Lida Eslami, Exchange Traded Product specialist, London Stock Exchange, said: “We have over a thousand ETPs on London Stock Exchange, offering investors exposure to a vast range of underlyings. This exemplifies the industry’s fantastic growth story and London’s ability to offer the widest diversity of products. We are delighted to welcome the Robo-Stox Global Robotics and Automation GO UCITS ETF to London today, another example of innovation on our markets.”
The ETF has been listed in three currency lines – pound sterling (ROBG), euro (ROBE) and US dollar (ROBO) – and is registered for distribution in the United Kingdom, Ireland, France, Germany, the Netherlands, Italy, Norway, Denmark, Sweden, Finland, Spain and Luxembourg.
It has a total expense ratio of 0.95%.