ProcureAM’s UFO ETF Jumps to $800M Ahead of SpaceX IPO

ProcureAM’s Procure Space ETF (UFO) grew from roughly $30 million at its low point to more than $800 million in assets under management after launching in 2019. The firm said the fund retained its space-investment focus through periods of volatile flows.

At launch UFO held about $140 million before assets fell to near $30 million. Over the past year the ETF’s assets rose from roughly $50 million to above $800 million as investor interest in space-related companies increased.

The fund’s underlying index will add a new mega-cap IPO rule effective May 15 that allows qualifying large initial public offerings to be included one day after their IPO price is calculated. ProcureAM said the change is intended to let the ETF add newly public large aerospace companies quickly; the firm identified SpaceX as a potential candidate for fast inclusion if it lists.

UFO follows a rules-based methodology that requires at least 80% of the index to be made up of pure-play space companies. ProcureAM defines pure-plays as firms that derive at least 50% of revenue from space-related activities, including launch services, satellites, ground systems and related services. Holdings in the current portfolio include Rocket Lab (RKLB).

Andrew Chanin, ProcureAM’s chief executive, described the sector as undergoing “transformational changes” and said a public listing by SpaceX would be “completely eye-opening” for the industry and retail investors. He spoke about the fund and sector trends in a recent interview with the firm.

ProcureAM cited lower launch costs from reusable rockets and increased government spending on space capabilities as factors drawing investor attention away from blank-check deals and toward companies focused on reusable launch systems and defense-related space services.

VettaFi LLC serves as the index provider for the UFO benchmark and receives an index licensing fee. ProcureAM notes VettaFi does not issue, sponsor, endorse or have liability for the ETF itself.