Investing in infrastructure ETFs offers a cost-effective way to access stable, recession-resistant cash flows from global infrastructure assets secured by long-term contracts, often with governments. These ETFs provide diversified exposure without the high capital requirements and risks of direct investments.

Therefore, investors seeking to build strong portfolios may consider options like Global X U.S. Infrastructure Development ETF (PAVE), iShares Global Infrastructure ETF (IGF), and iShares U.S. Infrastructure ETF (IFRA).

The expanding global population and rising middle class are fueling demand for advanced telecommunications, transportation, and essential services. Simultaneously, increasing public debt is driving privatization and co-investment opportunities, benefiting experienced infrastructure firms. As a result, the infrastructure market is projected to grow to $3.69 trillion by 2029, at a CAGR of 6.3%.

This year, the Biden-Harris Administration boosted the infrastructure sector with $62 billion from the Bipartisan Infrastructure Law, funding critical upgrades, job creation, and improved transportation systems. Climate-focused policies further drive investments in sustainable infrastructure. As the sector expands, investor interest grows, reinforcing confidence in its strong return potential.

Furthermore, infrastructure assets demonstrate resilience and stability, thriving even in volatile or high-inflation environments. With this in mind, let’s delve into the fundamentals of the three infrastructure ETFs highlighted above.

Global X U.S. Infrastructure Development ETF (PAVE)

Global X Funds – Global X U.S. Infrastructure Development ETF is an exchange-traded fund launched and managed by Global X Management Company LLC. It invests in the U.S. public equity markets, targeting stocks in construction and engineering, infrastructure raw materials, composites, industrial transportation, and heavy construction equipment. The fund targets both growth and value stocks across   diversified market capitalizations. Additionally, it seeks to track the performance of the Indxx U.S. Infrastructure Development Index using a full replication technique.

With $8.55 million in assets under management (AUM), PAVE’s top holding is Trane Technologies plc (TT) with a 3.71% weighting, followed by Quanta Services, Inc. (PWR), with a 3.52% weighting, and Eaton Corp. Plc (ETN), with 3.46%. It has a total of 101 holdings.

It has an expense ratio of 0.47%, higher than the category average of 0.44%. It currently has a NAV of $40.23. PAVE’s fund inflows came in at $1.85 billion over the past year.

The ETF pays an annual dividend of $0.22, which yields 0.55% on the current price. It has a four-year average dividend yield of 0.59%. Also, its dividend payouts have increased at a CAGR of 16.4% over the past three years and 13% over the past five years.

PAVE has gained 18% over the past year and 9.9% over the past six months to close the last trading session at $40.25.

PAVE’s POWR Ratings reflect this promising outlook. The POWR Ratings are calculated by considering 118 different factors, each weighted to an optimal degree.

PAVE has a B grade for Buy & Hold. In the Industrials Equities ETFs group, it is ranked #12 out of 36 stocks. Click here to access all of PAVE’s POWR Ratings.

iShares Global Infrastructure ETF (IGF)

IGF is an exchange-traded fund launched by BlackRock, Inc. and managed by BlackRock Fund Advisors. The fund invests in the public equity markets of globally developed regions. It focuses on stocks in sectors like energy, oil, gas, transportation, utilities, and infrastructure. The fund targets growth and value stocks of large-cap companies and seeks to track the performance of the S&P Global Infrastructure Index using a representative sampling technique.

With $4.93 billion in AUM, the fund has a total of 77 holdings. IGF’s top holding is Enbridge Inc. (ENB) with a 4.44% weighting, followed by NextEra Energy, Inc. (NEE) with a 4.39% weighting, and Grupo Aeroportuario del Pacífico, S.A.B. de C.V. (PAC) with 3.32%.

IGF has an expense ratio of 0.42%, lower than the category average of 0.44%. It currently has a NAV of $52.65. Its fund inflows came in at $1.09 billion over the past six months.

The ETF pays an annual dividend of $1.68, which yields 3.19% on the current price. IGF has a four-year average dividend yield of 2.75%. Its dividend payouts have increased at a CAGR of 13.4% over the past three years.

IGF has gained 10.8% over the past nine months and 12.1% over the past year to close the last trading session at $52.67.

IGF’s strong outlook is reflected in its POWR Ratings. The ETF has an overall rating of B, translating to a Buy in our proprietary rating system. It has an A grade for Buy & Hold and a B for Peer and Trade. It is ranked #18 out of 133 ETFs in the Global Equities ETFs group. To access all the POWR Ratings for IGF, click here.

iShares U.S. Infrastructure ETF (IFRA)

IFRA is an exchange-traded fund launched by BlackRock, Inc., and it is managed by BlackRock Fund Advisors. The fund invests in U.S. public equity markets, targeting stocks in sectors such as materials, industrials, capital goods, construction, engineering, machinery, transportation, railroads, and utilities. It invests in both growth and value stocks of companies across diversified market capitalizations. The fund seeks to track the performance of the NYSE FactSet U.S. Infrastructure Index using a representative sampling technique.

With $3.10 billion in assets under management (AUM), IFRA’s top holding is New Fortress Energy Inc. (NFE) with a 0.97% weighting, followed by NorthWestern Energy Group, Inc. (NWE), with a 0.80% weighting, and CenterPoint Energy, Inc. (CNP) with 0.80%. IFRA has a total of 158 holdings.

IFRA has an expense ratio of 0.30%, lower than the category average of 0.44%. It currently has a NAV of $46.19. Its fund inflows came in at $527.30 million over the past six months.

The ETF pays an annual dividend of $0.81, which yields 1.75% on the current price. It has a four-year average dividend yield of 1.87%. Likewise, its dividend payouts have increased at a CAGR of 5.5% over the past three years and 11% over the past five years.

IFRA has gained 10.8% over the past six months and 14.9% over the past year to close the last trading session at $46.22.

IFRA’s POWR Ratings reflect its promising prospects. IFRA has a B grade for Buy & Hold. Within the Industrial Equities ETFs group, it is ranked #14. Click here to access all of IFRA’s POWR Ratings.

What To Do Next?

Get your hands on this special report with 3 low priced companies with tremendous upside potential even in today’s volatile markets:

3 Stocks to DOUBLE This Year >

PAVE shares rose $0.15 (+0.37%) in after-hours trading Friday. Year-to-date, PAVE has gained 0.99%, versus a 1.00% rise in the benchmark S&P 500 index during the same period.

About the Author: Abhishek Bhuyan

Abhishek embarked on his professional journey as a financial journalist due to his keen interest in discerning the fundamental factors that influence the future performance of financial instruments. More...

More Resources for the Stocks in this Article