Andrew Chanin, Co-Founder and CEO of ProcureAM, sponsor of the Procure Space ETF (UFO).
Andrew Chanin is Co-Founder and CEO of ProcureAM, sponsor of the Procure Space ETF (UFO).
Mr. Chanin created PureFunds and had been a sponsor in the ETF market from 2012-2017.
Mr. Chanin began his ETF career in 2007 working for the specialist firm Kellogg Group.
Mr. Chanin quickly worked his way up from clerk to Lead Market Maker for global and international equity ETFs, helping the company transition from its core American Stock Exchange ETF specialist business to NYSE Arca ETF market making.
In 2009, Mr. Chanin was recruited by Cohen Capital Group to build out the firm’s ETF trading capabilities.
At Cohen Capital Group, Mr. Chanin held the title of Director of International Trading, where he made markets in a variety of ETFs across various asset classes while helping to develop multiple global and international equity/ETF trading strategies for the company’s prop trading division.
“In bringing out a product that was focusing on the space industry, it was really important to us to have an interest in pure-play space companies.
And the way the fund is structured is, we track the S-Network Global Space Index.
And some of the things that they look for are a company’s percentage of revenues derived from space-related businesses, activities and services.
For us, that was an important feature to make sure that the fund had a heavy focus on these companies that were primarily space revenue focused companies, but also realizing that the space industry is one that has numerous players, and some of them may be more diversified but have very major roles.
Up to 20% of the index at time of rebalance can also be allocated towards these more diversified names.
Think of them as your more diversified aerospace and defense names.
In some cases, these are also referred to as primes in the industry.
And realizing that although they might not have the majority of the revenues coming from space, they are doing some pretty incredible things and do have fairly large space businesses underneath their hood.
It also made sense to have some exposure to those companies.
So right now there are over 30 names in the space that are in UFO.
And those names specialize in various areas across the space industry.
And it also has a global focus.
These names aren’t just U.S.-listed names.
They are names from exchanges around the globe that do have, in some cases, either a majority of their revenues from space, or they are major diversified aerospace and defense players.”
The UFO stock index investment in the Space Industry sector is now important as a long term portfolio play according to Andrew Chanin.
“I think the fact that there are adversarial nations looking to become dominant players in space, it ups the ante for any country that wants to have a strong presence there.
And by stepping off the gas and losing focus on achieving various space accomplishments, it’s opening the door for potential adversarial nations to become the leader in space.
And it’s now widespread thinking from the highest levels of the military that space is the new strategic high ground for modern warfare.
And by that, we’re talking about modern weapon systems, missiles, guidance, tracking, even secure communications and other military strategies that are reliant upon space-based technologies and services and communication.
So to the extent that other nations — which currently is the case — are demonstrating and talking to their various space-related goals, it forces the U.S. to take that seriously and to continue to remain competitive.
And many people believe that the winners over the next couple decades of this new space race are going to have a strategic advantage for potentially decades beyond that.
So it’s imperative for those that see the future importance of space and want to have a major presence there that they have a strong focus on the immediate, mid and long term of that planning.
President Trump, during his former administration, saw space as being so important, especially from the military and defense standpoint, to carve out the U.S. Space Force as its own separate distinct military branch.
And I think that type of foresight is also kind of a foreshadowing of the deemed perspective of how important space will be moving forward.
And that it demands its own specific singular focus as well.
Beyond that, all different branches of the military also rely on space for various reasons as well.
So this is something where the first space race was much more of a vanity project to say, “yes, look, we can do it, look at what we’ve done,” and we did it faster than our adversaries.
Now there’s an entire strategic standpoint where losing out on the space race isn’t an option if your goal is long-term survivability, or dominance in any of the theaters of military or even economics and commerce.”
The Space Industry has had a dramatic decrease in launch costs, mainly as a result as new innovations in reusability.
“…With the advent of reusable rockets, we’ve been able to see the costs of accessing space decrease significantly.
So, not only is that exciting for a launch company that’s able to lower costs for their customers, but also seeing the ability for those customers to now be able to justify their various projects or corporate missions, or whether you are a government or a military entity that requires space, being able to now access space at a lower cost opens up a tremendous amount of opportunities.
So the type of company that can now be considered a space company has broadened significantly as well, due to their ease of accessing space.
And that has been probably one of the major drivers that SpaceX has put forward.
Now we’re seeing other companies such as Rocket Lab (NASDAQ:RKLB) trying to utilize similar methods of reusability so that they can also provide low-cost access to space, as well as companies from around the world that are looking to compete in this launch industry.”
Get the complete interview with Andrew Chanin, Co-Founder and CEO of ProcureAM, sponsor of the Procure Space ETF (UFO), exclusively in the Wall Street Transcript.
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