If you’re looking for an ETF that tracks the performance of cruise lines, you may be out of luck. As of now, there isn’t a specific ETF dedicated solely to the cruise industry. However, that doesn’t mean you can’t invest in cruise lines through other means.
What is an ETF?
An Exchange-Traded Fund (ETF) is a type of investment fund that is traded on stock exchanges, much like individual stocks. The main difference between an ETF and a mutual fund is that an ETF trades throughout the day on an exchange, while mutual funds are priced only once at the end of each trading day.
Why invest in cruise lines?
Cruise lines are a popular way to travel and many investors see them as a potential growth opportunity. According to Cruise Lines International Association (CLIA), nearly 30 million passengers are expected to take a cruise in 2019 alone. This represents significant potential revenue for the companies operating these cruises.
How to invest in cruise lines without an ETF
While there isn’t a specific ETF for cruise lines, there are other ways to invest in this industry.
- Individual Stocks: You can purchase stocks in individual companies such as Carnival Corporation (CCL) or Royal Caribbean Cruises Ltd (RCL). These two companies alone account for nearly 70% of the global cruise market share.
- Mutual Funds: While there isn’t a specific ETF for cruise lines, there are mutual funds that hold positions in these companies.
For example, Fidelity Select Leisure Fund (FDLSX) has holdings in both CCL and RCL.
- Travel and Leisure ETFs: While not specific to cruise lines, investing in an ETF that focuses on travel and leisure could potentially include positions in cruise line companies. For example, the Invesco Dynamic Leisure and Entertainment ETF (PEJ) holds positions in CCL and RCL.
- Dividend Reinvestment Plans (DRIPs): Many cruise line companies offer DRIPs, which allow you to reinvest your dividends into additional shares of stock. This can be a cost-effective way to build your position in a company over time.
Conclusion
While there isn’t a specific ETF for cruise lines, there are still ways to invest in this industry. By doing your research and considering individual stocks, mutual funds, travel and leisure ETFs, or DRIPs, you can potentially benefit from the growth opportunities that the cruise industry has to offer. Remember to always do your due diligence and consult with a financial advisor before making any investment decisions.