Hanetf Launches Drone and Ukraine Reconstruction ETFs Amid Growing Defense Investment
Investment in the defense sector is gaining traction, with a surge in new Exchange Traded Funds (ETFs) launched in recent years. On Friday, March 6, 2026, Hanetf introduced two new ETFs to the Italian stock exchange, Piazza Affari: one focused on drone technology and another targeting the reconstruction of Ukraine. These launches reflect a broader trend of increasing investor interest in both defense technologies and opportunities arising from the rebuilding efforts in Ukraine.
Drone Technology ETF Takes Flight
The Hanetf Drone ETF aims to provide investors with targeted exposure to global companies involved in the development, production, and operation of drones and unmanned aerial vehicle (UAV) technologies. The ETF, which replicates the VettaFi Drone UCITS Index, prioritizes “pure” exposure, focusing on companies where the majority of their revenue is directly tied to the drone industry. This approach is designed to appeal to passive investors seeking focused thematic investments without the risk of diluted exposure from companies with tangential drone-related activities.
The portfolio composition leans heavily towards small-capitalization stocks, with over 40% allocated to companies with smaller market caps. This strategy aims to avoid larger corporations where drone technology might represent a smaller, less central part of their overall business. Geographically, the ETF’s holdings are primarily based in the United States (almost half of the 41 titles), followed by Australia (16%), Canada (9%), Israel (8.8%), and China (5.8%). European Union representation is currently limited, with small allocations to France (2.4%) and Germany (0.8%).
The ETF has an annual expense ratio (TER) of 0.69%, placing it in the higher range for passive sector ETFs, including thematic ones focused on defense.
Beyond Military Applications
While the defense sector is a key driver, Hanetf emphasizes the broader potential of drone technology. “Drones have become central to the conflict in Ukraine in recent years, and global defense spending has adapted to this new reality,” notes Tom Bailey, Head of Research at Hanetf. Although, he also highlights the expected faster growth of commercial drone applications in the coming decade, particularly in sectors like construction, industrial inspection, agriculture, and logistics.
The civilian drone market is experiencing a compound annual growth rate of 6.8%, projected to increase from $10.1 billion in 2024 to $20.6 billion by 2033.
Hanetf Launches First Ukraine Reconstruction ETF
In addition to the drone ETF, Hanetf has also received regulatory approval to launch the world’s first ETF specifically focused on companies contributing to the reconstruction of Ukraine following the Russian invasion. Citywire reports that while other ETFs offer exposure to Ukrainian stocks, this new product will be the first dedicated exclusively to reconstruction efforts.
The Ukraine Reconstruction UCITS ETF will be domiciled in Ireland and launched through Hanetf’s white-label platform, with trading facilitated by Atlanta-based Vident. Hanetf, already managing a Future of Defence UCITS ETF with EUR 2.7 billion in assets, is leveraging its expertise in defense-related investments to address the long-term rebuilding needs of Ukraine.
EU Support for Ukraine’s Recovery
The launch of the Ukraine Reconstruction ETF aligns with broader European Union (EU) initiatives to support Ukraine’s recovery and modernization. The EU has adopted the Ukraine Facility, which will mobilize up to €50 billion between 2024 and 2027. The European Council has initiated accession negotiations with Ukraine, demonstrating a long-term commitment to the country’s integration with Europe. The European Training Foundation (ETF) has been cooperating with Ukraine for 30 years and continues to prioritize support for the country’s education, training, and labor market needs.