Fueled by rapid innovation and rising investor interest, the space economy continues to gather momentum. The S&P Kensho Space Index has outperformed the S&P 500, reflecting rising confidence and an increasingly bullish market environment.
The space index has added 65.62% over the past year and 19.69% in January so far, significantly outpacing the broader market index, which has gained 13.66% and 0.44%, respectively.
Per Seraphim Space, as quoted on Reuters, global space-tech investment is expected to accelerate this year, supported by defense-driven government spending and rising private investment in launch capacity. At the same time, space infrastructure is emerging as a strategic asset, as economies seek investment to strengthen their geopolitical positioning.
The expanding role of space-based technologies and the sector’s growing importance in defense operations all help justify increasing investor focus on the space economy, reinforcing long-term growth prospects for the industry.
According to Seraphim Space data, as quoted on the abovementioned Reuters article, the space sector saw record investment in 2025, as private funding jumped 48% to $12.4 billion, with a notable $3.8 billion raised in the final quarter. The United States captured nearly 60% of global funding, fueled by launch services demand and defense programs such as the Golden Dome initiative.
With modern warfare evolving and drone technology advancing, nations are increasingly investing in space-based systems to strengthen their military capabilities.
As per the Reuters article, in December, U.S. President Donald Trump signed an executive order, formally elevating space to a core national security and economic priority, reinforcing investor expectations for stronger funding momentum. The executive order, titled “ENSURING AMERICAN SPACE SUPERIORITY,” has formalized the U.S. objective of returning humans to the Moon by 2028 while strengthening defenses against potential space-based threats.
Additionally, a potential SpaceX IPO could be a defining catalyst. The IPO could have broader implications for market dynamics, with the listing likely acting as a benchmark for valuing the broader space and aerospace industry, catalyzing a new wave of investment interest and generating new inflows into listed space-sector players.
ETFs to Explore
With growing interest in the broader space economy and growing capital infusion in the space sector, expanding exposure to funds focused on space-related industries may be beneficial, given their distinct long-term growth potential.
Below, we highlight a few funds that investors can consider to gain increased exposure to the space economy.
Investors can consider Procure Space ETF UFO, ARK Space & Defense Innovation ETF ARKX and SPDR S&P Kensho Final Frontiers ETF ROKT.
With a one-month average trading volume of 1.17 miilion shares, ARKX is the most liquid option, ideal for active trading strategies. However, to fully benefit from the sector’s growth trajectory, a long-term investment approach is recommended.
ARKX has also gathered an asset base of $767.1 million, the largest among the other options. Regarding annual fees, ROKT is the cheapest option, charging 0.45%, which makes it more suitable for long-term investing.
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Procure Space ETF (UFO): ETF Research Reports SPDR S&P Kensho Final Frontiers ETF (ROKT): ETF Research Reports ARK Space & Defense Innovation ETF (ARKX): ETF Research ReportsThis article originally published on Zacks Investment Research (zacks.com).
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