Hi there,
CARS is a good way to get broad exposure to the EV industry. It seeks to replicate the Solactive Future Cars Index which is full of innovative and young EV companies. A quick look at their top 10 and you'll see companies like Fisker, Ambarella, FuelCell and Microvision.
What I like about this ETF is that it holds a basket of worldwide stock. While 48% of holdings are based in the US, the rest is spread out worldwide.
The fund has a spotty history and did pretty much nothing between 2017 and mid-2019. That is when EVs really started to take off, and in 2020 the ETF soared to new heights. Can it continue this level of performance? It'll depend on your outlook on EV. Personally, I am bullish but do think the valuations had gotten way ahead of themselves and some are still quite expensive.
That being said, owning a basket of industry innovators is a lower risk proposition than trying to pick which one will come out on top. Not all of these EV companies will be successful. Overall, I think it is a good way for investor to get broad exposure to the EV space. While there is still considerable risk involved, as mentioned it is lower risk that picking and buying individual EV plays.
Mat