7 Best Electric Vehicle ETFs to Buy

Written by Sean GraytokUpdated: 31st Jul 2022
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This article analyzes the seven best Electric Vehicle ETFs on the market.

Every vehicle on the road may be electric in the future. The laws are shifting, and the automakers are responding, but should you do the same in your portfolio?

Best Electric Vehicle ETFs: Background 

An electric vehicle ETF provides thematicexposure to stocks that are designing, manufacturing, or stand to benefit from the increased adoption of EVs.

EV ETFs offer diversification across a fast-moving industry. Spreading your capital across an emerging, sometimes unpredictable, subsector like EVs can lower your portfolio’s risk.

Additionally, the ETFs in this article enable capital exposure to various industries up and down the EV supply chain, from battery tech to artificial intelligence and semiconductor stocks.

Please note that a car can be electric without being autonomous.

At a Glance: Best Electric Vehicle ETFs

Here are the seven best electric vehicle ETFs:

  • Global X Autonomous & Electric Vehicles (DRIV)
  • Global X Lithium & Battery Tech ETF (LIT)
  • KraneShares Electric Vehicles & Future Mobility ETF (KARS)
  • iShares Self-Driving EV and Tech ETF (IDRV)
  • SPDR S&P Kensho Smart Mobility ETF (HAIL)
  • ARK Autonomous Technology & Robotics ETF (ARKQ)
  • Amplify Lithium & Battery Technology ETF (BATT)

Best Electric Vehicle ETFs

#1. Global X Autonomous & Electric Vehicles (DRIV)

DRIV seeks to invest in companies involved in developing autonomous vehicle technology, EVs, and EV components and materials.

  • Performance over 1-Year: -15.00%
  • Expense Ratio: 0.68%
  • Assets Under Management: $941 million

Global X believes there is high growth potential in the EV market, noting that while EV registrations increased by more than 40% in 2020, EVs were still less than 5% of new cars sold. A nice arbitrage opportunity is unfolding.

DRIV’s top holding gives you a sense of the fund — it has high allocations to Nvidia (NVDA), Google (GOOG), Microsoft (MSFT), and Apple (AAPL), none of which mass-produce vehicles.

Each of these companies pulls forward EV growth in some unique way, whether it’s edge computing, software, self-driving, or branding.

For example, Nvidia’s Systems-on-a-Chip (SoC) enables computing power in a mobile environment.

DRIV might appear to be misleading given its focus on search engines, software, and smartphones, but we believe FAAMG will play a significant role in driving EV progress.

DRIV Top Holdings:

  • Apple (AAPL) 3.66%
  • Qualcomm (QCOM) 3.37%
  • Alphabet (GOOGL) 3.29%
  • Toyota (7203:TKS) 3.15%
  • Tesla (TSLA) 3.05%

#2. Global X Lithium & Battery Tech ETF (LIT)

LIT seeks to provide investment results that correspond to the performance of the Solactive Global Index. This index tracks the returns of the full lithium cycle from mining and refining the metal through battery production.

  • Performance over 1-Year: -7.00%
  • Expense Ratio: 0.75%
  • Assets Under Management: $4.5 billion

Global X created an entirely separate fund designated for the technology that powers electric vehicles.

This optionality allows investors to choose which part of EV innovation they’re bullish on.

If all car manufacturers release EV versions and people just buy the EV version of the car they were previously buying… to what degree will the existing vehicle landscape change? And would any gains be a result of selling EVs?

If the shift to EVs is anticlimactic from a vehicle manufacturer’s perspective, perhaps the investment returns will be found in the battery tech that enabled the shift.

We expect some level of a shake-up in existing manufacturers as some will transition to EV better than others, but not to the degree that ARK estimates.

A car can be electric without being autonomous.

Over 50% of LIT invests in Chinese companies; the US comes in second at 22%.

LIT Top Holdings:

  • Albemarle (ALB) 11.34%
  • EVE Energy Co. (300014:SHE) 6.35%
  • Sociedad Quimica Y Minera De Chile (SQM) 5.35%
  • BYD Company (1211:HKG) 5.75%
  • Contemporary Amperex Technology Co. (300750:SHE) 5.32%

#3. KraneShares Electric Vehicles & Future Mobility ETF (KARS)

KARS seeks to measure the performance of the Bloomberg Electric Vehicles Index, which follows companies engaged in the production of EVs and their components or engaged in other initiatives that may change the future of mobility.

  • Performance over 1-Year: -15.00%
  • Expense Ratio: 0.70%
  • Assets Under Management: $252 million

KARS provides exposure beyond electric cars and includes ‘new transportation’ methods across passenger and freight vehicles.

This includes access to vehicle connectivity companies developing things like the Internet of Vehicles (IoV) and Intelligent mobility.

Additionally, KARS has a large allocation to equities listed in Mainland China, currently the world’s largest EV market.

Bloomberg estimates that 55% of new car sales and 33% of the global car fleet are projected to be electric by 2040. It expects the global EV market to command $2.7 trillion of total investment before 2040.

KARS Top Holdings:

  • Contemporary Amperex Technology Co. (300750:SHE) 4.64%
  • NIO Inc. (NIO) 4.61%
  • Tesla (TSLA) 4.40%
  • BYD Company (002594:SHE) 4.35%
  • Aptiv (APTV) 4.07%

#4. iShares Self-Driving EV and Tech ETF (IDRV)

IDRV seeks to track the investment results of an index composed of developed and emerging market companies that may benefit from growth and innovation in and around EVs, battery technologies, and autonomous driving technologies.

  • Performance over 1-Year: -16.00%
  • Expense Ratio: 0.47%
  • Assets Under Management: $456 million

IDRIV has a similar objective and fund construction as the first ETF mentioned in this article, the Global X Autonomous & Electric Vehicle ETF (DRIV).

It provides access to global stocks along the full value chain of self-driving and EV industries and does not discriminate by sector or geography.

This ETF has a slightly stronger bias towards semiconductor stocks than Global X’s DRIV. Stocks like AMD, Nvidia, Qualcomm, Intel, and Samsung are all in the top ten holdings.

While DRIV and IDRV are similar in most areas, they differ in fees. IDRV’s expense ratio is lower at 0.47%, while DRIV is 0.68%.

IDRV Top Holdings:

  • Tesla (TSLA) 4.73%
  • Qualcomm (QCOM) 4.54%
  • Apple (AAPL) 4.45%
  • Toyota Motor Corp. (7203: TKS) 4.07%
  • Alphabet (GOOGL) 3.92%

#5. SPDR S&P Kensho Smart Mobility ETF (HAIL)

HAIL seeks to provide investment returns of an index designed to capture companies whose products and services drive innovation behind smart transportation. This includes autonomous driving and connected vehicle technology, drones used for commercial and civilian applications, and advanced transportation tracking and transport optimization systems.

  • Performance over 1-Year: -31.00%
  • Expense Ratio: 0.45%
  • Assets Under Management: $82 million

HAIL is a “smart mobility” ETF, so you’re getting the full spectrum of moving things with this one.

While auto manufacturers and auto part companies make up over a third of the fund, HAIL provides access to construction machinery, heavy trucks, trucking, aerospace and defense, “steel”, agriculture and farm machinery, and much more.

You’ll probably recognize fewer companies in HAIL compared to other EV ETFs in this article — the median market cap of the holdings is $5.7 billion.

HAIL Top Holdings:

  • Tesla (TSLA) 1.61%
  • Li Auto (LI) 1.57%
  • Qualcomm (QCOM) 1.54%
  • Lordstown Motors (RIDE) 1.52%
  • Rivian Automotive (RIVN) 1.50%

#6. ARK Autonomous Technology & Robotics ETF (ARKQ)

The ARK Autonomous Technology & Robotics ETF provides exposure to autonomous vehicles, energy storage, robotics and automation, 3D printing, and space exploration. So, a little more than electric vehicles.

  • Performance over 1-Year: -31.00%
  • Expense Ratio: 0.75%
  • Assets Under Management: $1.2 billion

How could we cover electric vehicles and not include ARK? Cathie Wood has been a Tesla perma-bull before it was cool — she called for $4,000 TSLA when the stock was around $180.

Just a few years later, it eclipsed her price target on a split-adjusted basis, and she didn’t waste any time setting a new one.

ARK’s new 2030 price target for Tesla is $25,000 per share pre-split.

TSLA is a primary holding in multiple ARK funds, but it’s the best fit for ARKQgiven its desire to achieve full self-driving.

The rest of ARKQ consists of AI stocks across various industries but with a growing bias towards space stocks. So much so that ARK created a new fund specifically made for the space economy called the ARK Space Exploration & Innovation ETF.

ARKQ Top Holdings:

  • Tesla (TSLA) 10.79%
  • Trimble (TRMB) 8.40%
  • Kratos Defense & Security Solutions (KTOS) 7.93%
  • UiPath (PATH) 6.06%
  • Iridium (PATH) 5.93%

#7. Amplify Lithium & Battery Technology ETF (BATT)

The Amplify Lithium & Battery Technology ETF is a portfolio of companies generating significant revenue from the development, production, and use of lithium battery technology, including battery storage solutions, battery metals and materials, and EVs.

  • Performance over 1-Year: -15.00%
  • Expense Ratio: 0.59%
  • Assets Under Management: $185 million

Amplify projects the lithium-ion battery market to grow from an estimated $44.2 billion in 2020 to $94.4 billion by 2025, a CAGR of 16.4%

This ETF is an alternative to the previously mentioned Global X Lithium & Battery Tech (LIT) fund. They’re more similar than they’re different, but their variations are worth analyzing.

Both funds focus on cradle-to-grave battery companies and have large allocations to China-based companies, but to varying degrees. BATT consists of 36% Chinese companies, while LIT is 36%.

Each have similar ~6% allocations to Tesla.

Comparing industry breakdowns between two ETFs can be useless because each provider is free to categorize sectors in their own way, but each has high allocations to “Materials” — 42% for BATT and 48% for LIT.

Last but not least: fees. Amplify’s BATT is more cost-effective than LIT, charging 0.59% in fees compared to 0.75%.

LIT has earned the right to demand top-dollar. It launched nearly a decade before BATT and has grown significantly since. LIT is 20x the size of BATT by assets under management.

BATT Top Holdings:

  • Contemporary Amperex (300750:SHE) 5.18%
  • Tesla (TSLA) 6.63% 
  • BYD Company (1211:HKG) 4.81%
  • BHP Group (BHP) 5.65%
  • Glencore (GLEN) 3.96%

Alternatives to the Best Electric Vehicle ETFs

One alternative to electric vehicle ETFs is to consider one of the lithium and battery tech ETFs discussed.

They provide granular access to the infrastructure that enables EVs without worrying if Ford or Toyota has a better EV strategy.

Or you can lean into the autonomous and robotics niche and find a Robotics ETF you like. Self-driving won’t be possible without harnessing the full capabilities of AI, machine learning, and deep learning.

Best Electric Vehicle ETF: The Risks

You don’t have to worry about electric vehicle adoption. States in the US, like California, will prohibit the sales of gas-powered vehicles by 2035. As of this writing, 11 other states have joined California’s initiative.

Most automakers have planned accordingly and announced their EV strategy and goals during earnings call this past year. The ones that are slow to shift their fleet will die.

Despite the shifting legal grounds and the adapting automakers, the US is still behind most nations when it comes to adoption. That’s one reason why these EV ETFs allocated 80% of their assets to non-US companies.

We believe the primary risk here is an anticlimactic shift to EVs. One way to hedge this risk is by buying into the battery funds.

Another risk to consider is the lack of information and analyst coverage on many of the individual international holdings that comprise EV ETFs.

Some of these funds have +100 holdings. Conducting due diligence on each one is nearly impossible, especially given the different regulatory requirements and financial transparency that can vary significantly from one geography to the next.

Frequently Asked Questions

What is the best EV ETF?

The best EV ETF is either the Global X Autonomous & Electric Vehicle ETF (DRIV) or the Global X Lithium & Battery Tech ETF (LIT). Each focuses on a different piece of the EV value chain.

Is there an ETF for EV?

There are several ETFs for EVs:

  • Global X Autonomous & Electric Vehicles (DRIV)
  • Global X Lithium & Battery Tech ETF (LIT)
  • KraneShares Electric Vehicles & Future Mobility ETF (KARS)
  • iShares Self-Driving EV and Tech ETF (IDRV)
  • SPDR S&P Kensho Smart Mobility ETF (HAIL)
  • ARK Autonomous Technology & Robotics ETF (ARKQ)
  • Amplify Lithium & Battery Technology ETF (BATT)

Does Vanguard have an electric vehicle ETF?

Vanguard does not have an electric vehicle ETF. However, it does have a full suite of low-cost ETFs that provide broad or narrow exposure to the market or a specific sector, depending on your investing goals.

What is the EV ETF?

An electric vehicle (EV) ETF is an exchange-traded fund that invests in companies involved in the EV market. From mining the resources to designing the cars, buying an EV ETF will add this type of exposure to your portfolio.

Bottom Line: Best Electric Vehicle ETFs

The electric vehicle market is at a key inflection point in history. It’s unlikely that the market would have accelerated like this without the work of Elon Musk and Tesla.

But as you can see, Tesla isn’t the only investment option in this space anymore.

This article is for informational purposes only. It is not intended to be investment advice. Read more about our editorial integrity and public equities research methodology to better understand our approach to identifying investment opportunities.

This article was updated on July 31st, 2022 to reflect the changes in performance and characteristics of each fund.  

Sean Graytok
Sean Graytok

Sean Graytok is our Co-Founder and leading expert in investing and financial management. His work has been cited in leading industry publications, such as InvestorPlace and Business Insider. Sean is interested in the people and technologies that are improving the world.