Investing in automotive ETFs in Canada allows you to capitalize on the car and vehicle industry. These investments provide a diversified approach to invest in the sector broadly. These funds typically consist of stocks from companies engaged in manufacturing, technology, and services related to automotives. Notable players in the Canadian automotive ETF space include those focusing on electric vehicles, traditional automakers, and component suppliers. Investors seeking exposure to automobiles, mobility, and transportation can consider these ETFs for potential portfolio growth. But before making a final decision, it’s essential to conduct thorough research. You must consider factors like expense ratios, current holdings, and market trends. This will help you select the best automotive ETF for your investment goals. We’ve provided some baseline information in this article, keep reading to learn more!

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How to make money with ETF?

To make money with ETFs, investors should follow a strategic approach. Firstly, research and select ETFs that align with your investment goals. Do you want broad market exposure or sector-specific focus? Regularly monitor market conditions and adjust your ETF holdings accordingly. Additionally, consider using ETFs for diversification, risk management, and cost-effectiveness. Long-term investing, coupled with disciplined rebalancing, can capitalize on market growth. Traders can employ ETFs for short-term gains by exploiting market inefficiencies. Regardless of the strategy, staying informed about market trends is important. It is also ideal to conduct due diligence and research on desirable ETFs. This helps ensure investment growth and stability.

An ETF makes money through capital gains from its underlying assets. These assets can include stocks, bonds, or commodities. Investors buy and sell ETF shares on the stock exchange at market prices. The fund’s value reflects the performance of its holdings. Benefits of ETFs include diversification, liquidity, and lower expense ratios compared to mutual funds. Drawbacks may include tracking errors, potential for market losses, and limited control over the fund’s management. However, ETFs remain popular for their simplicity, transparency, and flexibility. As they provide exposure to various asset classes and investment strategies.

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Why invest in the automotive industry?

Investing in the automotive industry offers diverse opportunities. It is significantly driven by technological advancements, shifting consumer preferences, and global demand for transportation. The rise of electric vehicles, autonomous driving technologies, and sustainability initiatives presents growth opportunities. Established automakers and innovative companies in the electric and autonomous sectors provide a balanced investment landscape. The industry’s cyclical nature can be navigated by strategic timing and long-term perspective. As global economies recover, increased mobility demands contribute to profitability. Investing in the automotive sector allows investors to tap into a dynamic and evolving market. A market with the potential for innovation-driven returns and growth. Finally, some investors choose to buy into the automotive industry simply out of personal interest. If you love to drive, upgrade your car and use vehicles yourself, investing in the industry might be of interest to you.

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Is there an automotive ETF in Canada?

Evolve Automobile Innovation Index Fund is a Canadian automotive ETF. It markets itself as Canada’s “first automobile innovation ETF”. This fund aims to invest in innovative automobile technologies that will change the auto sector in the future. They state that they take the guesswork out of investing in the future of the automobile. They largely invest in the companies that contribute batteries, sensors, and other important components of automobiles.

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6 Best Automotive ETFs in Canada

Canadians typically invest in American automotive ETFs due to the limited Canadian options. Selecting the “best” automotive ETF depends on various factors. An investor must consider an ETF’s investment goals, risk tolerance, and expense ratios. Further, investors must understand the specific areas within the automotive sector they would like to target. Each ETF has its focus, constituents, and strategy. It’s essential to research and align your investment goals with the best automotive ETF for yourself.

Based on past performance, holdings, and overall popularity, some of the popular automotive ETFs include:

Ticker Symbol	Inception Date	Yield	MER	Risk
CARS	September 27th, 2017	1.21%	0.40%	High
DRIV	April 18th, 2018	1.61%	0.68%	Medium
CARZ	May 9th, 2011	1.53%	0.70%	Medium
IDRV	April 16th, 2019	1.70%	0.47%	High
KARS	January 18th, 2018	1.08%	0.72%	High
HAIL	December 18th, 2017	2.62%	0.45%	High

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1. Evolve Automobile Innovation Index Fund (CARS)

This is the main automotive ETF available on the Canadian market, as mentioned above. Evolve Automobile Innovation Index Fund is Canada’s first automobile innovation ETF. Their goal is to invest in the innovation of cars. At the moment, they primarily invest in the inputs related to cars, such as sensors and batteries.

2. Global X Autonomous & Electric Vehicles ETF (DRIV)

Global X Autonomous & Electric Vehicles ETF (DRIV) mainly includes companies involved in electric and autonomous vehicles which will be shaping the future of transportation. Here’s a few more details:

• Significant assets are held with various automobile companies. Toyota, Tesla, Honda and General Motors are a few.
• Significant assets are held with technology companies, set to change the future of automation, including Intel, Alphabet, Apple, and Microsoft.

3. First Trust S-Network Future Vehicles & Technology ETF (CARZ)

First Trust S-Network Future Vehicles & Technology ETF (CARZ) tracks the NASDAQ OMX Global Auto Index, including global automobile manufacturers. It further includes electric and autonomous vehicle manufacturing, companies that create their materials and technologies. Below are additional details:

• Significant assets are held with technology companies, set to change the future of automation, such as Intel, NVIDIA, Alphabet, Apple, and Microsoft.
• Significant assets are held with various automobile companies. Toyota and Tesla are two.

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4. iShares Self-Driving EV and Tech ETF (IDRV)

iShares Self-Driving EV and Tech ETF (IDRV) aims to track an index of companies involved in electric and autonomous vehicles. Here’s some additional information:

• Significant assets are held with technology companies, including Schneider Electric, ABB, and LG.
• Significant assets are held with various automobile companies. Volkswagen and Renault are two.

5. KraneShares Electric Vehicles and Future Mobility ETF (KARS)

KraneShares Electric Vehicles and Future Mobility ETF (KARS) invests in companies related to electric vehicles and future mobility trends. Below are further details:

• Significant assets are held with technology companies, such as Panasonic and Samsung.
• Significant assets are held with various automobile companies. Aptiv and Nidec are two.

6. SPDR Kensho Smart Mobility ETF (HAIL)

SPDR Kensho Smart Mobility ETF (HAIL) tracks the Kensho Smart Transportation Index. It focuses on next-generation transportation technology and innovation. This includes autonomous vehicles. They have a diversified portfolio with their highest investment in Aurora Innovation Inc., representing 2.37% of the total assets. This company focuses on autonomous freight technology.

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Can you really make money on ETFs?

Investors can potentially make money with ETFs through a variety of strategies. ETFs offer diversification, liquidity, and cost-effectiveness. Investors can quickly gain exposure to different asset classes and market trends. Whether through long-term investing for capital appreciation, income generation, or short-term trading for tactical gains. ETFs provide significant flexibility.

However, it’s crucial to conduct thorough research. You must understand the specific ETF’s objectives and consider market conditions. Like any investment, risks exist, and past performance is not indicative of future results. A well-informed and disciplined approach is key to successful ETF investing.

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