An ETF to track SPACs opens for trade today

The Defiance NextGen SPAC IPO ETF (NYSEARCA:SPAK) will begin trade on the NYSE today. The fund charges a fee of 45 basis points.

SPAK will mostly track shares of companies listing on exchanges via mergers with special purpose acquisition vehicles (SPACs), otherwise known as blank-check companies.

The overwhelming majority of the fund (80%) will be in already active SPAC mergers (think things like DraftKings and Virgin Galactic). The remaining 20% will be in SPACs that have yet to make a purchase and have no operations (think things like Bill Ackman’s Pershing Square Tontine Holdings).

SPACs, of course, have exploded in popularity this year, with 112 IPOs raising nearly $43B through the first three quarters. In 2019, there were 59 SPAC IPOs raising $13.6B.