With A Democrat In The White House, These ETFs Are Set To Charge Higher

 | Nov 09, 2020 05:04

U.S. President-elect Joe Biden's key campaign promises are in focus as investors consider how to adjust their portfolios to gain from the next administration's policies.

During the presidential debates and in written plans throughout his campaign, Biden highlighted several areas that would be the cornerstone of his presidency. Two areas in particular stand to benefit from the Biden administration: infrastructure spending and clean energy.

Against this background, here are two exchange-traded funds (ETFs) focusing on those domains that stand to benefit:

h2 iShares U.S. Infrastructure ETF /h2
  • Current price: $26.42
  • 52-week range: $16.69 - $29.03
  • Yield: 1.03%
  • Expense ratio: 0.40%

The President-elect's plans to increase spending on building roads, bridges, tunnels, and other infrastructure projects, will likely benefit firms in the space. We can divide companies into owners—railroads and utilities, and enablers—and operators, including materials and construction companies.

When analyzing individual infrastructure stocks, the strength of their assets, quality of management, and valuation levels are all important factors. A company's growth prospects in terms of revenue and cash flow, market position, and regulatory issues should also be considered.

The iShares U.S. Infrastructure ETF (NYSE:IFRA) provides access to U.S.-based firms likely to benefit from increased infrastructure activities. The fund started trading in April 2018.