GRID: Despite Tariff Chaos, Electrification Theme Firmly In Place

Summary

• The GRID ETF offers diversified exposure to global electrification, AI data centers, and EV themes, but faces risks from Trump tariffs and a potential economic downturn.
• Despite market volatility, the fund's top holdings in electrical component manufacturers like ABB, Johnson Controls, and Schneider Electric show strong growth prospects.
• The ETF's valuation metrics are trading at a discount to the S&P500, but GRID's relatively high expense ratio is a valid concern.
• My rating is a HOLD. That said, investors should try to take advantage of market volatility to pick up shares of GRID and companies like EATON Corp. "on the cheap".
• Alternative investments on the electrification theme include NextEra Energy and the SPDR Utilities ETF (XLU), both of which currently yield ~3%.

AI Data Center With Row-after-Row of Server Racks

Oselote

Despite the tariff chaos and general uncertainty due to the Trump administration's economic and political policies, the trend toward electrification appears to be both undeniable and unstoppable. I say that because, to

Analyst’s Disclosure: I/we have a beneficial long position in the shares of VOO, QQQ, DIA, ETN, NEE, XLU either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

I am an electronics engineer, not a CFA. The information and data presented in this article were obtained from company documents and/or sources believed to be reliable, but have not been independently verified. Therefore, the author cannot guarantee their accuracy. Please do your own research and contact a qualified investment advisor. I am not responsible for the investment decisions you make.