2 U.S. Infrastructure ETFs To Buy On Biden's Massive Push

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President Biden has recently proposed a $2 trillion package to reshape the U.S. Infrastructure. As a result, infrastructure ETFs like Global X US Infrastructure Development (PAVE) and iShares U.S. Infrastructure (IFRA) are expected to soar. 

The American Society of Civil Engineers (ASCE) has given America’s Infrastructure a rating of C- in its 2021 report, because of its frequent water breaks, wear and tear of roads and bridges, and interrupting electricity. The deteriorating condition of US infrastructure is one of the key reasons behind President Biden’s proposed $2 trillion infrastructure and jobs package. Biden hopes to rebuild the majority of the existing infrastructure in areas of Transportation, Water, Broadband and Power, Housing and Education, and Manufacturing and Labor, in line with his aim to “Build Back Better.”

The huge government spending on infrastructure will benefit several companies involved in infrastructure-related activities in the upcoming months. Therefore, we expect Global X US Infrastructure Development ETF (PAVE - Get Rating) and iShares U.S. Infrastructure ETF (IFRA - Get Rating), which have substantial exposure to infrastructure stocks, to be positioned to deliver solid returns.

Global X US Infrastructure Development ETF (PAVE - Get Rating)

PAVE invests in companies that correspond generally to the price and yield performance of the Index U.S. Infrastructure Development Index. The fund invests at least 80% of its total assets in the securities of the underlying index. PAVE has $2.61 billion in assets under management. The ETF’s major holdings include Deere & Company (DE), Parker-Hannifin Corporation (PH), and Eaton Corp. PLC (ETN).

PAVE has an expense ratio of 0.47%, which is slightly higher than the category average of 0.43%. It also has an MSCI ESG Fund Rating of A. The ETF distributes $0.09 in dividends annually, which translates to a dividend yield of 0.37%. Its four-year average dividend yield is 0.49%.

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