HANetf: ETF Future of Defence reaches $253 million in AUM

HANetf has announced that the Future of Defence ETF (Ticker: NATO) has reached a total assets under management of $253.02 million, following over $200 million in net inflows in 2024.

Launched just nine months ago, in July 2023, NATO follows the EQM Future of Defence Index and aims to provide exposure to global companies that generate revenue from NATO and NATO+ allies' defence and cyber defence spending. The maximum exposure per country is 60%, allowing companies based outside the United States and NATO+ members to gain significant weight in the portfolio and offering more diversified global exposure.

Future of Defence ETF (NATO)

Investors are increasingly aware of the current geopolitical situation, accentuated by ongoing conflicts between Russia and Ukraine and Israel and Hamas. As a result, defence spending is on the rise.

In 2023 a record $2.24 trillion spending was recorded, the highest level ever recorded. A particular area of growth is among the European members of NATO. These countries have been shaken from their post-Cold War spending slump following Russia's invasion of Ukraine, with renewed efforts to reach the NATO military spending target of 2% of GDP.

Furthermore, in the 21st century, national security is not just about physical borders and military force. Governments must now consider safeguarding cyberspace, which has become a new battlefield. Cybersecurity attacks are steadily increasing with rising geopolitical tension.

The Future of Defence ETF (NATO) combines these two components of modern defence, capturing both the growing conventional military budgets and the increasing need for robust cyber defence. Using a rule-based passive approach, companies must derive more than 50% of their revenue from the production and development of military aircraft and/or defence equipment or have commercial operations in cybersecurity contracted with a NATO+ member country.

In March, the defence ETF was also recognized at the XENIX ETF Special Awards UK 2024, where it was named Best Innovative Newcomer ETF.