Core Insights - The defense ETF sector has rapidly expanded, now comprising approximately 22 pure-play ETFs with around $42 billion in assets and $9 billion in net inflows this year, driven by rising geopolitical tensions [3][10] Defense ETF Growth - The defense ETF category has seen significant growth since late 2024, increasing from 13 ETFs and $14.5 billion in assets to the current figures [3] - Traditional U.S. defense ETFs remain popular, with the Invesco Aerospace & Defense ETF (PPA) holding nearly $8 billion in assets and the iShares U.S. Aerospace & Defense ETF (ITA) being the largest with $13 billion in assets [4] New Launches and Performance - Eight out of nine new defense ETF launches since 2025 have been global or international offerings, indicating a shift in investor interest [5] - The Global X Defense Tech ETF (SHLD) has over $8 billion in assets, with $6 billion gathered in the past year, while the Select STOXX Europe Aerospace & Defense ETF (EUAD) rose 74% last year [5] - Defense ETFs have shown resilience during recent market pullbacks, performing relatively strong compared to the S&P 500 [7] Emerging Subcategories - Space and drone subcategories are gaining attention, with the Procure Space ETF (UFO) holding $360 million in assets and drone ETFs like the REX Drone ETF (DRNZ) and the Defiance Drone and Modern Warfare ETF (JEDI) each holding just over $80 million [6] Money Market ETF Launch - The ProShares Genius Money Market ETF (IQMM), launched in late February, has reached $22 billion in assets and is the first money market ETF designed to meet Genius Act requirements for stablecoin reserves [8][10]

Core Insights - The defense industry is evolving into a multifaceted investment opportunity, driven by international defense spending, space technology, and the rise of drones, appealing to investors seeking stable growth alternatives to higher-beta sectors like technology [1][2][9] Group 1: Global Defense Opportunities - Geopolitical tensions and increased military budgets, particularly in Europe and Asia, have led to a surge in defense spending, broadening investment opportunities beyond U.S. contractors [2] - The emergence of new ETFs focused on international defense themes indicates a growing investor appetite for global defense exposure, with eight new defense ETFs launched in 2025 and 2026, seven of which are globally or internationally focused [3] Group 2: Space Technology Integration - Space technology has become an integral part of defense, with investments in satellites, missile warning systems, and communications networks, reflecting a convergence of defense and commercial innovation [5] - The ETF market has responded with products like the ARK Space & Defense Innovation ETF (ARKX) and the Procure Space ETF (UFO), which target companies involved in space technology and defense [6][10] Group 3: Drone Technology - Drones are increasingly significant in defense, offering lower-cost, flexible, and autonomous systems for warfare and surveillance, thus expanding the investment case beyond traditional military hardware [7] - New ETFs such as the Defiance Drone and Modern Warfare ETF (JEDI) and the REX Drone ETF (DRNZ) are emerging, highlighting the distinct investment theme of drones within the broader defense sector [8][11] Group 4: ETF Performance and Holdings - The Procure UFO ETF, with over $360 million in assets, focuses on space technology and has a significant allocation to communication companies, while the Roundhill MARS ETF targets the space value chain with fewer holdings [10] - The REX DRNZ ETF emphasizes pure-play drone companies, achieving a 17% year-to-date return, while the Defiance JEDI ETF offers a broader approach to drone and modern warfare technologies [11]

Core Insights - The 2026 BBH Global ETF Investor Survey indicates a robust global demand for ETFs, with a notable shift towards active management and thematic ETFs [1] - Nearly all surveyed investors (96%) plan to increase their ETF exposure over the next 12 months, consistent with previous findings from February 2025 [1] Active Management Trends - In 2025, approximately 1,000 new active ETFs were launched, with 98% of professional investors intending to expand their exposure to actively managed ETFs in the coming year [1] - A majority of ETF investors (66%) believe that active management will be the most attractive investment approach over the next 12 months, compared to 34% favoring passive management [1] - Most investors (94%) anticipate that active ETFs will reach $10 trillion in assets within the next decade, with 77% expecting this milestone within seven years [1] Thematic Investing Growth - There is a significant interest in thematic investing, with 36% of surveyed investors looking to increase their exposure, marking a 17% increase from 2025 [1] - Specific strategies gaining traction include dividend/income ETFs (33%) and defined outcome ETFs (26%) [1] - Thematic ETFs linked to VettaFi indexes are highlighted as opportunities for investors seeking targeted exposure beyond broad market indices [1] ETF Market Preferences - The survey underscores a clear trend where investors are moving towards active management and high-conviction thematic strategies, moving away from broad market exposure [1] - The BBH report provides extensive data on various aspects of the ETF market, including regional allocation nuances and the maturation of fixed income ETFs [1] - The ETF wrapper remains the preferred investment vehicle for both institutional and retail investors navigating a complex macro environment [1]

Core Insights - The drone and unmanned aerial vehicle (UAV) industry experienced significant growth in January, as evidenced by the REX Drone ETF (DRNZ) which rose 14.92% year-to-date as of January 30, 2026 [1] - The success of the drone industry is attributed to its applications beyond defense, including agriculture, infrastructure, and commercial delivery, as well as its connection to the AI sector [1] - Strong individual stock performances within DRNZ, such as Red Cat Holdings and Amprius Technologies, contributed to the fund's impressive returns, with Red Cat Holdings increasing by 70.24% and Amprius Technologies by 57.67% in January [1] Industry Performance - Thematic investing in sectors like drones and UAVs is becoming increasingly attractive for investors seeking growth opportunities [1] - The combination of sector-wide momentum and strong individual stock performances is enhancing the appeal of thematic ETFs like DRNZ for diversification and exposure to compelling market sectors [1]

Core Insights - The REX Drone ETF (DRNZ) represents a significant opportunity in the drone industry, which has evolved from niche gadgets to essential tools across various sectors including defense, infrastructure, energy, agriculture, and public safety [3][4]. Group 1: The Drone Opportunity - Drones are now seen as mission-critical tools rather than just consumer gadgets, indicating a long-term structural theme driven by adoption curves across a global ecosystem [3]. - The opportunity in drones is not limited to a single company or product but encompasses a broad range of hardware, software, and services [3]. Group 2: REX's Thematic ETF Strategy - REX Shares aims to provide investors with access to thematic investments, and the launch of DRNZ aligns with their philosophy of offering focused and disciplined investment products [4][5]. - The company has a history of being first in various ETF innovations, including leveraged single stock ETFs, which demonstrates their commitment to pioneering new investment opportunities [5]. Group 3: Beyond Defense - While drones are included in some defense-related ETFs, REX emphasizes that the drone market extends beyond military applications to include industrial uses such as agriculture, construction, and public safety [6]. - The drone industry is characterized by its broad-based growth and global scaling, making it a compelling investment theme [6]. Group 4: Portfolio Allocation for DRNZ - Advisors typically allocate to DRNZ by carving out a small portion from traditional sector exposures or from broader thematic allocations, positioning it as a high-conviction satellite investment [8]. - DRNZ can serve as a replacement for individual drone stocks, providing a more diversified exposure to the drone sector [8].

Core Insights - Thematic exchange-traded funds (ETFs) are experiencing a resurgence in 2025, particularly in niche subsectors like drone technology, which presents long-term investment opportunities [1] - The REX Drone ETF (DRNZ) is positioned to capture the growth potential of the drone industry, which is projected to exceed $163 billion by 2030 [6] Group 1: Investment Case for Drone Technology - A significant portion of webinar attendees (almost 50%) are unfamiliar with the drone industry as a viable investment opportunity, indicating a need for education [3] - The drone industry has evolved from military applications to commercial uses since the early 2000s, with advancements making drones "smaller, cheaper, and easier to use" [5] - REX Shares aims to create a rules-based, indexed fund that encompasses the entire drone market, rather than focusing solely on military applications [7][8] Group 2: Structure and Holdings of DRNZ - DRNZ is designed to provide pure-play exposure to the drone industry, with 80% of the fund allocated to companies generating at least 50% of their revenue from drone-related activities [11] - The fund also includes diversified companies that derive at least 20% of their revenue from drones, with a cap of 5% per constituent [11] - Notable holdings in DRNZ include companies like Draganfly, AeroVironment, EHang Holdings, and Droneshield, showcasing global diversification [17] Group 3: Portfolio Integration - Thematic funds like DRNZ typically occupy a satellite allocation in investment portfolios, complementing traditional growth exposure [12] - Advisors often allocate 3% to 5% of client portfolios to thematic ETFs, with DRNZ providing a diversified alternative to single-stock holdings in the drone sector [13][14] - DRNZ offers disciplined, rules-based access to a niche market, aligning with REX Shares' philosophy of providing unique ETF products [15]

Core Insights - REX Shares has launched the REX Drone ETF (DRNZ), the first ETF specifically focused on the drone and unmanned aerial vehicle (UAV) industry [1] - The ETF tracks the VettaFi Drone Index, which includes both "pure play" and diversified drone companies [1][2] - The global drone market is projected to double over the next decade, indicating significant growth potential [4] ETF Structure - The index allocates 80% of its weight to pure-play firms, which derive at least 50% of their assets, revenue, or profits from drones or enabling technologies [2] - The remaining 20% is allocated to diversified firms that derive at least 20% of revenue from drones or UAVs, or are defense companies with dedicated drone R&D programs [2] - The ETF consists of a portfolio of 38 global stocks, with top holdings including AeroVironment Inc. (14%), DroneShield (10.6%), and Ondas Holdings (10.1%) [3] Market Context - DRNZ enters a competitive market with the recent launch of the Defiance Drone & Modern Warfare ETF (JEDI), which has gathered $24 million in assets [6] - JEDI has a broader focus on military technologies, while DRNZ specifically targets the growth of drones beyond military applications [8] - JEDI's top holdings include Palantir (7.8%) and AeroVironment (7.3%), indicating a different investment strategy compared to DRNZ [7] Expense Ratio - The REX Drone ETF charges an expense ratio of 0.65% [5]

Core Insights - REX Shares has launched the REX Drone ETF (DRNZ), marking the first fund to provide pure-play exposure to the drone industry [1] Company Developments - The introduction of DRNZ expands REX Shares' range of alternative ETF investment solutions [1] - The fund aims to capitalize on the growing demand and investment opportunities within the drone sector [1] Industry Trends - The drone industry is experiencing significant growth, driven by advancements in technology and increasing applications across various sectors [1] - The launch of DRNZ reflects a broader trend of financial products focusing on niche markets and emerging technologies [1]