You have probably heard that there is an exchange traded fund (ETF) strategy for almost every investment sector and almost every type of investment strategy you can imagine. Now there is an ETF dedicated to the world of pet care.
ProShares has launched the ProShares Pet Care ETF (PAWZ), which is being touted as the first ETF focused on the pet care industry. Its investment strategy is aimed to benefit from the proliferation of pet ownership, as well as the emerging trends affecting how people care for their pets.
This ETF is said to track the FactSet Pet Care Index, which was last shown to be comprised of 24 companies that provide broad exposure to potential growth within the pet care industry.
According to ProShares, seven out of 10 U.S. households now have pets. That is higher than the ratio of households that have children. The release also touted that pet owners are providing pets with premium foods, advanced health care, insurance and even luxury services.
Another claim is that the pet care industry could reach $203 billion in global sales by 2025. And as seen previously, the pet care industry has proven to be resilient in harder times and has grown steadily in dollars every year since 2001. The release said:
It (pet care) has seen twice the percentage growth of GDP since 2007, and increased even during the Great Recession. Corporate investment interest in the pet care industry has intensified, too. More than 80 mergers and acquisitions over the past 12 months indicate that a wide range of companies is attracted to and investing in this dynamic opportunity.
Investors do need to consider one issue here. This is not just a U.S. equity ETF. Over 58% of the fund’s country weighting is in the United States, followed by just over 19% for the United Kingdom and over 4% each for Switzerland, France and Austria. The top 10 holdings for the fund were listed as follows:
- Dechra Pharmaceuticals
- Idexx Labs
- Central Garden & Pet
- ZooPlus
- CVS Group
- Petmed Express
- Trupanion
- Nestle
- Heska
- Zoetis
If you really do not believe that pet care is a booming industry, go back to a March article from 24/7 Wall St. that is based on data from the American Pet Products Association. It showed that U.S. pet spending alone was a whopping $69.5 billion in 2017 alone, with more growth as far as the eye can see.
Michael L. Sapir, co-founder and CEO of ProShare Advisors and the advisor to ProShares, said of the ProShares Pet Care ETF debut:
Seven out of 10 U.S. households today have pets, which is more than have children. And like parents with kids, pet owners will likely spare little expense to ensure their pets have lives as healthy and fulfilling as their own. Pet owners are spending billions on premium-quality foods, state-of-the-art health care, insurance policies, luxury services and more. It’s causing a new pet care economy to emerge that could reach $203 billion by 2025. With PAWZ, we’re giving investors broad exposure to this emerging industry in a single ETF.
On a final note, if any of this sounds too crazy, take this to heart: some pet owners are even renting private jets, not just because it’s easier for them, because it’s easier for them to take their pets with them and without restriction or worry.
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