Mon Sep 09 16:09:47 UTC 2024: ## Investors Ditch Futuristic Tech for Old-School Industrials

**Toronto, Canada** – While Wall Street traders are betting big on futuristic technologies, investors are flocking to industrial ETFs, demonstrating a shift towards traditional, real-economy investments. This trend is driven by a confluence of factors:

* **Economic self-sufficiency:** The US government’s focus on boosting domestic production and supply chains in the wake of the pandemic is fueling demand for industrial companies.
* **Climate change:** The push for new energy infrastructure and green initiatives is creating opportunities within the industrial sector.
* **Geopolitical pressures:** Growing tensions around the world are further incentivizing nations to prioritize domestic production and reduce reliance on foreign suppliers.

This shift in investor sentiment is evident in the performance of thematic ETFs. The Global X U.S. Infrastructure Development ETF, with its focus on industrial stalwarts like Parker-Hannifin Corp. and United Rentals Inc., has surpassed Cathie Wood’s Ark Innovation ETF, previously a poster child for innovation-based investments, in terms of asset size. The Ark Innovation ETF has seen continuous outflows this year, reflecting investor skepticism towards disruptive, yet largely unprofitable, tech companies.

Experts attribute this shift to the dismal performance of tech-focused thematic funds and the increased market uncertainty. “Investors tend to go for more tangible investment ideas when there’s more market uncertainty and less money to allocate,” says Roxanna Islam, head of sector and industry research at TMX VettaFi. “Industrial themes like infrastructure and reshoring can offer a relatively safer growth story than disruptive technology funds.”

This trend is further solidified by the recent launch of several new ETFs focusing on industrial themes, including a Global X infrastructure fund excluding US firms, BlackRock’s iShares U.S. Manufacturing ETF, and Tema Global’s American Reshoring ETF.

While investors are not abandoning tech altogether, the shift towards industrials suggests a preference for safer, more tangible investments in a volatile market. It remains to be seen whether this trend will continue in the long run, but for now, investors are placing their bets on the old-school, real-economy sector.

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