Canadians may be feeling overwhelmed by the poor market performance these days, and I wouldn’t blame you. However, it’s not always a time to cower when the market does poorly. Instead, it could be a great time to find new opportunities.

And, one of the most compelling opportunities out there could still be the travel and leisure industry. With pandemic restrictions having eased off, airlines in particular have seen bookings near or at 2019 levels. It seems that after years of being unable to travel, it’s now a high priority for Canadians, even if this means saving their pennies on everything else.

So with that in mind, how can Canadian investors access the potential growth opportunities the travel sector has to offer without taking on the higher levels of risk inherent in single stock investment? With its broad diversification benefits and liquid structure, an exchange traded fund could be the ideal choice.  

Harvest Travel & Leisure Index ETF

The Harvest Travel & Leisure Index ETF (TRVL) is the only ETF at present to provide Canadian investors with focused exposure to the travel industry. Launched in January 2021, the fund entered the market at a perfect time to take advantage of the easing of pandemic restrictions and capture the likely growth potential of companies in the travel sector such as airlines, hotels and cruise lines. 

At first, shares of TRVL jumped about 22% between coming on the market and March of 2021. However, since then there has been a slow, but steady decline downward. Shares are now down 25% since March of last year, and about 14% year-to-date.

Given the current economic climate, this short-term performance is unsurprising. But for longer-term investors with a bullish view on the fortunes of the travel and leisure industry TRVL could be a solid addition to your investment portfolio.

It’s not just Canada

While this is a Canadian ETF, TRVL does not only invest in Canadian companies such as Air Canada, but offers broader exposure to 30 North American large-cap companies that own or operate travel related businesses. The fund’s top holdings include well established names across the industry such as Marriott, Booking Holdings, Hilton, Delta Airlines and Southwest Airlines.

Great numbers, better opportunity

Now of course the problem is that while a rebound was hoped for immediately, we instead were hit with an economic downturn. Rising interest rates, inflation and energy prices have all impacted the performance of TRVL in the near term.

Yet coming out of this economic downturn and even a recession, we should see TRVL do very well. It was one of the most searched for ETFs when it came on the market, and that’s likely to happen again. Especially as the hunger for travel really has not waned, even in light of the ongoing poor economy.

TRVL currently holds about $138 assets under management (AUM), a relatively low 0.452% management expense ratio (MER) and employs a passive investing approach, tracking the Solactive Travel & Leisure Index.

So there you have it. By investing in TRVL today, you can gain access to the rebound and recovery potential of the travel, leisure and airline industries in the near term. Long-term, you’ll gain exposure to the solid performance of these top 30 companies. All through one ETF.

Disclaimer: This article is limited to the dissemination of general information pertaining to investment strategies and financial planning and does not constitute an offer to issue or sell, or a solicitation of an offer to subscribe, buy, or acquire an interest in, any securities, financial instruments or other services, nor does it constitute a financial promotion, investment advice or an inducement or incitement to participate in any product, offering or investment.