The Reopening: International Travel (JETS)

The world is returning to travel mode...

Last week, Dr. Anthony Fauci, the White House medical adviser, said that he expects Omicron cases to peak in February. “Things are looking good. We don’t want to get overconfident, but they look like they’re going in the right direction right now.” The mild symptoms of the Omicron variant and peaking/declining numbers of the new cases in many countries resulted in governments easing pandemic restrictions.

According to Bloomberg, "New York lifted a mask mandate for businesses, while federal officials say they are updating national guidance. The U.K. is removing its last precautions - even the need to self-isolate after a positive test." Canada, the Netherlands, Denmark and France have also announced relaxations of Covid related measures.

Restrictions easing in individual countries is an important step towards eliminating travel related hurdles like Covid testing, online registrations with often poorly functioning and misleading apps, quarantine requirements, etc. If the virus does not unpleasantly surprise us once again, international travel could become much simpler this summer. This should trigger an international travel rush.

January and February airline bookings are already catching up to the amount of pre-pandemic bookings for both domestic and international flights. At the same time, ticket prices are going up, indicating strengthening demand. Corporate bookings for business travel are increasing as well and are likely to climb further due to the ongoing mass returns to offices. You can find more details here.

US Global Jets ETF (JETS) seems like an obvious way to invest for the long-term in the upcoming recovery of domestic and international air travel. The price of JETS is still relatively low as it has just left bear market territory. As of February 9, 2022, the ETF price was $23.10, which is 19.5% below its one year peak of $28.71 from the middle of March last year.

This blog does not provide investment advice. Please do your own research and talk to professionals before investing.

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