Investor interest in ETFs tied to geopolitical security, energy independence, and critical supply chains is gaining momentum amid geopolitical unrest, as asset managers roll out new funds targeting these strategic themes.
Against this backdrop, XFUNDS by Nicholas Wealth launched two new income-oriented ETFs last week— the Nicholas Nuclear Income ETF (NYSE:NUKX) and the Nicholas Defense and Rare Earth Income ETF (NYSE:WEPN)— expanding its thematic ETF lineup.
The funds aim to give investors exposure to sectors increasingly viewed as central to national security and economic competitiveness while also generating income through options strategies. The ETFs were launched in partnership with Tidal Investments LLC.
Targeting Strategic Industries
The NUKX ETF focuses on the nuclear energy ecosystem, investing in companies tied to nuclear power generation, infrastructure, and related technologies. Nuclear energy has gained renewed attention globally as governments seek reliable, low-carbon power sources amid rising electricity demand and decarbonization goals.
Meanwhile, the WEPN ETF targets companies operating in defense-related industries and in the supply chain for rare earth elements and critical minerals. These materials—including lithium, copper, cobalt, and steel—are widely used in military equipment, advanced manufacturing, and industrial production.
Multi-Layer Portfolio Structure
Both ETFs combine three distinct investment components.
The first is an equity portfolio consisting of publicly traded companies aligned with each fund's theme, offering exposure to firms positioned to benefit from sustained government and private-sector investment in these areas.
The second component provides commodities exposure through U.S.-listed exchange-traded funds and exchange-traded products tied to relevant materials. For NUKX, that includes uranium, a key input in nuclear power generation, while WEPN provides exposure to strategic metals used in defense and industrial supply chains.
The third layer uses an actively managed options overlay strategy designed to generate income from option premiums while maintaining exposure to the underlying investments.
The new additions underscore a growing trend among ETF issuers to combine thematic exposure with income-generating strategies as investors look for yield in specialized sectors tied to long-term global trends.
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