The DWS Group has launched an ETF that gives investors exposure to technology companies that have been deemed critical to maintaining U.S. national security.
The Xtrackers US National Critical Technologies ETF (CRTC) invests in large- and mid-cap firms from developed market countries. These firms meet specific criteria associated with technology sectors and geopolitical risk ratings, according to the firm.
DWS is specifically focusing on companies associated with 14 critical technology areas that have been labeled as vital to the overall national security of the country and securing its future, the firm said in a statement. The Office of the Undersecretary of Defense Research & Engineering, which is a division of the Department of Defense (DoD), has classified those areas.
“We have a first mover advantage,” said Amanda Rebello, head of passive U.S. onshore sales at the firm. “We don’t see that there’s any other ETF which is providing a similar exposure.”
The 14 areas are divided into three main categories, according to Rebello. The first are emerging opportunities that include biotechnology, quantum science, advanced materials and future generation wireless technology.
The second is effective adoption, including advanced computing and software, space technology, renewable energy generation and storage, trusted AI and autonomy, and human/machine interfaces. The final area is defense, including hypersonic, directed energy, and integrated sensing and cyber.
CRTC acts as an umbrella encompassing the three previous thematic ETFs the firm launched in July: the Xtrackers U.S. Green Infrastructure Select Equity ETF (UPGR), the Xtrackers Semiconductor Select Equity ETF (CHPS), and the Xtrackers Cybersecurity Select Equity ETF (PSWD).
“In our ongoing build-out of the Xtrackers ETF offering in the US market, we continue to focus on key strategic themes in the current economic environment as well as the foreseeable future,” said Dirk Goergen, CEO of DWS Americas. “Complementing our existing offerings in cybersecurity, semiconductors and U.S. green infrastructure, our newest launch, CRTC, is an innovative way for investors to gain efficient exposure to technologies deemed critical to the national security of the United States.”
The companies the fund tracks are a part of the U.S. Critical Technologies Index, which is the underlying index. J.H. Whitney Data Services, which serves as a strategic consultant, determines which companies to include on the index using a two-step process, the firm said.
CRTC is the fourth thematic ETF DWS that has launched this year.
