Given that I am bullish on the auto industry and interested in the electric vehicle (EV) space, I was intrigued when Global X launched its auto ETF (VROM) back in May. After the initial announcement and a quick glance at Global X's plans, particularly as it related to Tesla Motors (TSLA), I let VROM drop from my radar. Given VROM's recent performance, that was probably a bad move:
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A look at VROM's holdings, current as of July 6th, tells me several things. First, the obvious. If you want broad exposure to the auto space, VROM serves the purpose an ETF should serve. It provides instant diversification. Given the global exposure, there's really no way most individual investors could replicate this portfolio on their own without driving themselves crazy. Between deciding which Pink Sheets ticker is the correct one to go with and dealing with foreign exchange fees on some of the stocks, you might make yourself poor shortly after crazy.
| % of Net Assets | Name | Identifier | Market Price($) | Shares Held | Market Value($) | |
| 10.23 | TOYOTA MOTOR CORP-ADR (TM) | 892331307 | 84.27 | 1,956.00 | 164,832.12 | |
| 10.16 | DAIMLERCHRYSLER AG (DDAIF.PK) | 5529027 | 75.79 | 2,160.00 | 163,716.91 | |
| 7.86 | FORD MOTOR CO (F) | 345370860 | 13.96 | 9,074.00 | 126,673.04 | |
| 5.36 | BMW AG (BAMXF.PK) | 5756029 | 97.04 | 890.00 | 86,368.94 | |
| 4.99 | HYUNDAI MOTOR CO LTD (HYMLF.PK) | 6451055 | 231.29 | 348.00 | 80,489.80 | |
| 4.89 | HONDA MOTOR CO LTD -ADR (HMC) | 438128308 | 39.80 | 1,982.00 | 78,883.60 | |
| 4.24 | JOHNSON CONTROLS (JCI) | 478366107 | 41.99 | 1,626.00 | 68,275.74 | |
| 4.16 | VOLKSWAGEN (VLKAF.PK) | 5497102 | 189.45 | 354.00 | 67,065.79 | |
| 3.58 | HYUNDAI MOBIS | 6449544 | 374.85 | 154.00 | 57,727.42 | |
| 3.23 | PORSCHE AG - PFD (POAHF.PK) | 7101069 | 80.77 | 645.00 | 52,099.49 | |
| 2.69 | DONGFENG MOTOR-H (DNFGF.PK) | B0PH5N3 | 2.01 | 21,600.00 | 43,353.76 | |
| 2.66 | MICHELIN B (MCGFF.PK) | 4588364 | 95.33 | 450.00 | 42,897.00 | |
| 2.65 | KIA MOTORS CORPORATION (KIMTF.PK) | 6490928 | 71.31 | 600.00 | 42,786.77 | |
| 2.56 | GENERAL MOTORS CO (GM) | 37045V100 | 31.19 | 1,324.00 | 41,295.56 | |
| 2.18 | ASTRA INT'L (PTAIF.PK) | 6291712 | 7.62 | 4,600.00 | 35,073.79 | |
| 1.96 | TATA MOTORS LTD-SPON ADR (TTM) | 876568502 | 23.36 | 1,350.00 | 31,536.00 | |
| 1.88 | NISSAN MOTORS (NSANY.PK) | 6642860 | 10.84 | 2,800.00 | 30,353.52 | |
| 1.82 | MAGNA INTERNATIONAL - A (MGA) | 2554475 | 52.67 | 557.02 | 29,339.72 | |
| 1.64 | CONTINENTAL | 4598589 | 105.70 | 250.00 | 26,425.18 | |
| 1.55 | RENAULT (RNSDF.PK) | 4712798 | 58.24 | 429.00 | 24,983.97 | |
| 1.37 | GENUINE PARTS CO (GPC) | 372460105 | 57.01 | 386.00 | 22,005.86 | |
| 1.36 | FIAT SPA (FIATY.PK) | 5748521 | 10.95 | 2,000.00 | 21,907.11 | |
| 1.30 | BORG-WARNER INC (BWA) | 099724106 | 80.40 | 260.00 | 20,904.00 | |
| 1.18 | GUANGZHOU AUTO GROUP-H (GNZUF.PK) | B433995 | 1.23 | 15,400.00 | 19,016.74 | |
| 1.13 | PEUGEOT (PEUGY.PK) | 7103526 | 45.46 | 400.00 | 18,183.90 | |
| 1.13 | DENSO CORP (DNZOF.PK) | 6640381 | 36.33 | 500.00 | 18,164.40 | |
| 1.08 | AUTOLIV INC (ALV) | 052800109 | 77.99 | 224.00 | 17,469.76 | |
| 1.06 | BRIDGESTONE (BRDCF.PK) | 6132101 | 24.44 | 700.00 | 17,106.30 | |
| 0.93 | TRW AUTOMOTIVE (TRW) | 87264S106 | 58.35 | 256.00 | 14,937.60 | |
| 0.78 | VALEO (VLEEF.PK) | 4937579 | 69.90 | 180.00 | 12,581.92 | |
| 0.75 | BYD COMPANY (144A) (BYDDY.PK) | 6536651 | 3.35 | 3,600.00 | 12,050.42 | |
| 0.74 | WABCO HOLDINGS INC (WBC) | 92927K102 | 72.05 | 166.00 | 11,960.30 | |
| 0.67 | GOODYEAR TIRE & RUBBER CO (GT) | 382550101 | 17.85 | 602.00 | 10,745.70 | |
| 0.66 | GENTEX CORP (GNTX) | 371901109 | 30.96 | 344.00 | 10,650.24 | |
| 0.63 | SUZUKI MOTOR (SZKMF.PK) | 6865504 | 23.04 | 440.00 | 10,137.95 | |
| 0.53 | PIRELLI & CO | 4689803 | 10.76 | 800.00 | 8,608.30 | |
| 0.49 | AISIN SEIKI CO LTD | 6010702 | 39.12 | 200.00 | 7,824.47 | |
| 0.48 | HANKOOK TIRE CO. LTD. | 6107422 | 42.88 | 180.00 | 7,718.51 | |
| 0.42 | ISUZU MOTORS LTD | 6467104 | 4.81 | 1,400.00 | 6,731.77 | |
| 0.37 | NSK (NIPPON SEIKO) | 6641544 | 9.98 | 600.00 | 5,985.17 | |
| 0.37 | TOYOTA INDUSTRIES CORP | 6900546 | 33.07 | 180.00 | 5,951.79 | |
| 0.37 | BRILLIANCE CHINA AUTO | 6181482 | 1.09 | 5,400.00 | 5,904.94 | |
| 0.33 | MITSUBISHI MOTOR | 6598446 | 1.25 | 4,200.00 | 5,243.51 | |
| 0.31 | MAZDA MOTOR CORP | 6900308 | 2.74 | 1,800.00 | 4,939.43 | |
| 0.29 | FUJI HEAVY INDUS | 6356406 | 7.76 | 600.00 | 4,657.60 | |
| 0.24 | GEELY AUTOMOBILE HLDGS LT | 6531827 | 0.42 | 9,200.00 | 3,865.70 | |
| 0.21 | DAIHATSU MOTOR | 6250304 | 16.92 | 200.00 | 3,384.43 | |
| 0.18 | KOYO SEIKO (JTEKT) | 6497082 | 14.71 | 200.00 | 2,941.90 | |
| 0.17 | GS YUASA CORP | 6744250 | 6.70 | 400.00 | 2,679.85 | |
| 0.14 | TESLA MOTORS INC | 88160R101 | 28.96 | 78.00 | 2,258.88 | |
| 0.03 | EURO | EUR | 1.43 | 375.82 | 537.76 | |
| 0.03 | INDONESIA RUPIAH | IDR | 0.00 | 4,158,400.00 | 487.05 | |
| 0.01 | CASH | CASH | 1.00 | 205.90 | 205.90 |
About a week prior to VROM's launch, First Trust Advisors introduced the First Trust NASDAQ Global Auto Index Fund. CARZ has performed similarly to VROM, pulling back from its inception price of $30.00 to a low of $28.35 in mid-June. It closed Thursday's session at $31.82.
By and large, the two funds share benefits as well as holdings. CARZ's 4.35% stake in Harley Davidson (HOG), as of July 6th, and VROM's interest in JCI represent the most noteworthy divergences. Here's a look at CARZ's composition.
Click to enlarge
Here's a look at each ETF's top 10 holdings:
CARZ Holdings:
Prior to these two offerings it was next to impossible to tie yourself to the fate of the auto industry with an ETF. The best you could do was find funds that weight themselves heavily toward automakers, such as consumer discretionary or consumer goods funds like Consumer Discretionary Select Sector SPDR ETF (XLY), SPDR S&P International Consumer Discretionary Sector ETF (IPD) and iShares Dow Jones US Consumer Goods ETF (IYK). This strategy, however, represented little more than a sloppy and imprecise way to get the job done.
Disclosure: I am long TSLA, F.
Additional disclosure: I may initiate a position in VROM or CARZ within the next 30 days.
