In the vanguard of the winners, we clearly find the great historical powers, the first actors to conquer space: the United States (NASA), Russia (Roscosmos) and Europe (ESA). Beside them, the newcomers, who do not want this new playground to elude them: ambitious China (CNSA), modest India (ISRO), compliant Canada (CSA), prudent Japan (JAXA) and United Arab Emirates (UAE SA), international recognition and In search of new levers of growth and spending.
In 2021, the exploration of the galaxy is no longer reserved for a single nation, and many private companies are scrambling and scrambling through checkbooks to find a place for themselves. Often run by billionaires, these new space players are called SpaceX (by Elon Musk), Virgin Galactic (Richard Branson) and Blue Origin (Jeff Bezos). Besides, Larry Page (co-founder of Google) and Mark Zuckerberg (Facebook) have also shared their spatial ambitions. To this we must add ecosystem start-ups, institutions linked to states or continents, and some cranks like actor Tom Cruise and director Doug Liman, who want to make a film in space.
Set aside for decades, space activity is at the center of concern, this year more than ever. 2021 sees the return of many major events and competitions between major nations. If China’s recent arrival on the scene has reignited the hopes of some, it’s on top of the rare proximity of Earth and Mars this spring, which has helped revive global space activity. Overview of each person’s purpose (of the universe).
Paradoxically, space exploration is a way for states to demonstrate their power and superiority, both internationally and nationally. For the French CNES (National Center for Space Studies), it is a question of ensuring good cooperation between countries in space and preserving peace between participants. In 2022, economic considerations should take precedence over political considerations. Space is indeed a huge playground for nations as well as private companies.
The stars around us are full of exploitable resources. On the Moon, helium 3, a rare isotope on Earth and a potential source of energy, is abundant. Rare earths (cerium, terbium, scandium, mainly Chinese properties on Blue Planet) are also present in abundance.
Our natural satellites, as well as Mars, are covered in regolith, a dust from which water can be drawn. It will be possible to power rocket engines by mixing hydrogen and oxygen. The moon could then serve as an outpost for the search for the Red Planet, which is less than 8 months away from Earth. Tourism will also be one of the catalysts for space activities. Satellite activity will never end. Although frequencies are limited in number and allocated by the Geneva-based International Telecommunication Union, the race for speed is already underway for satellite Internet players.
Satellite communications, which today represent less than 1% of the global data transport market ($6 billion out of $800 billion annually) represent a huge reservoir of growth. The entry ticket for forming a constellation is high (between 2 and 10 billion dollars), but that does not prevent the proliferation of players interested in the possibility of economic benefits. The use of satellite data will complement terrestrial data collection, storage and distribution facilities. As the amount of data increases, the need for satellites will be felt.
According to American bank Morgan Stanley, revenues from space should grow from $350 billion in 2016 to more than $1,000 billion in 2040, with 40% coming from the satellite Internet sector.
To take advantage of this enthusiasm, it is possible to go through the vivid titles of companies exposed with the theme, such as Airbus, Boeing, Iridium, Virgin Galactic and other Lockheed Martin. There are also mutual funds and indices that track sectors. This is the case for the Selective Space Technology Index, which includes twenty stocks such as Dish Network, Kratos, Viasat, Boeing or Ball. Vontobel has issued a tracker certificate on this index, with geographic exposure that logically gives the best part of the US (81.6% of exposure).
Product: Open-end tracker certificate in selective space technology index
ISIN Code: DE000VX0EHA2
Risk Indicator: 5/7
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The Open-End Tracker Certificate in the Selective Space Technology Index is aimed at investors specializing in this type of product and should only be purchased by investors with specific knowledge. Vontobel recommends that prospective investors consult its “Risk Factors” section Tracker Certificate Base Prospectus. The risk factors described below represent the main risk factors.
Risk of capital loss : This product presents the risk of partial loss of the invested amount at any time. In case of a particularly adverse evolution of the underlying the loss of invested capital may be complete.
market risk : This product replicates its underlying performance and hence may experience significant price fluctuations at any point of time, resulting in total loss of the invested amount in some cases. This product does not include capital protection.
Risk of change: The Product Underlying is an index quoted in US Dollars (USD) whose components may be quoted in currencies other than USD. Thus the value of the underlying index depends on the exchange rate between the currency in which each component is quoted and the USD. Since the product is quoted in euros, its value also depends on the exchange rate between the euro and the US dollar. In case of an unfavorable evolution of this exchange rate, the product may lose value.
Risk of spread: The spread applied by the issuer to the price of the product may change over time. This development could be inconvenient for investors.
Liquidity Risk: It is possible that product quotations are temporarily interrupted.
Honor risk : By acquiring this product, the investor takes credit risk on the issuer and its potential guarantors.