Infrastructure Funds and ETF Introduction

What comes to the mind when someone mentions the word "Infrastructure"? Basically, the picture that emerges is some things that have to do with the construction for public use like roads, bridges, etc. and that is also something which is controlled or built by government (directly or indirectly). So when someone talks about making an investment in the infrastructure sector, then there can be various streams within the infrastructure sector. For one infrastructure interested investor, he may see growth opportunities for cement companies, some other investor may see benefits for Highway and road construction companies, others may be of the opinion that companies operating on toll roads may benefit, others may think of rail coach or rail wagon manufacturing companies, another group has airport development companies in mind, some may think of utility companies getting a boost like those of electricity and gas, others may see business for heavy machinery companies required for infrastructure development & construction, and so on.

Infrastructure Funds and ETF Details

So basically, infrastructure covers a very large area and multiple streams and when an investor is willing to make an investment in infrastructure sector, he needs to understand (or atleast have a vague idea about) the various infrastructure sub-sectors. Accordingly, he should select the right product or infrastructure fund or infrastructure ETF for making an investment. In this set of articles, we will cover Details about Infrastructure Funds and ETF

Given the above introduction, here are the various sub-sectors within the infrastructure sector where typically any infrastructure fund or ETF may invest the money. Basically, the money collected from investors goes into companies operating in these sub-sectors:

- Companies in Airport Development and Services business

- Companies in Highways & Rail tracks

- Companies in Marine Ports & Services

- Companies in Construction & Engineering

- Electric Utilities Companies

- Multi-Utilities Companies

- Gas Utilities Companies

- Companies in Oil & Gas Storage as well as Transportation business

- Companies manufacturing and operating Heavy Electrical Equipment

- Water Utilities Companies

- and many more

As one can see, there is a lot of variety available of different flavors in the infrastructure sector. Hence, blindly investing in the infra sector in the name of infra funds investments may be good from a layman's perspective, but if you are a serious investor who wishes to look at the fine lines, it is advisable to be aware about where actually your hard-earned money is going. For e.g., an infrastructure fund might be focusing only on construction material, while other may be country specific infrastructure fund because that particular country is expected to see infrastructure growth and benefit from it.

With this basic introduction to Infra funds, its time to head on to the next step Different Types Of Infrastructure Funds and Infrastructure ETF