European Defence ETF Launched by WisdomTree, a World First

The WisdomTree Europe Defence UCITS ETF (WDEF) and the WisdomTree Uranium and Nuclear Energy UCITS ETF (NCLR), listed today on the London Stock Exchange with total expense ratios (TER) of 0.40% and 0.45%, respectively.

The WisdomTree Europe Defence UCITS ETF (WDEF) seeks to track the price and yield performance, before fees and expenses, of the WisdomTree Europe Defence UCITS Index. The proprietary index is designed to track the performance of European companies involved in the defence industry which includes manufacturers of civil defence equipment, parts or products, defence electronics and space defence equipment. The index seeks to exclude companies that are involved in controversial weapons banned by international law, such as cluster munitions, antipersonnel landmines, and biological and chemical weapons, as well as companies that violate the UNGC (United Nations Global Compact) standards. WDEF is the first of its kind focused solely on European defence companies.

Following decades of underinvestment, European nations are committed to increasing defence budgets to meet the North Atlantic Treaty Organisation’s (NATO) 2% GDP target, with many already exceeding it. The increase in European defence spending reflects a strategic pivot towards addressing modern threats and ensuring regional security. This shift creates long-term opportunities in areas such as defence manufacturing, technological innovation, and space defence, offering significant growth potential for both established companies and emerging entrants in the industry.

The WisdomTree Uranium and Nuclear Energy UCITS ETF (NCLR) seeks to track the price and yield performance, before fees and expenses, of the WisdomTree Uranium and Nuclear Energy UCITS Index. The proprietary index is designed to track the performance of companies involved in the most critical components of the uranium and nuclear energy value chain. NCLR invests across the value chain, offering exposure to uranium miners, companies involved in the construction, development, and maintenance of nuclear energy infrastructure and reactors.  Innovators advancing next-generation nuclear technologies such as small modular reactors (SMRs) are also included.

Nuclear energy is regaining prominence amid rising global energy demand and the urgent need to achieve net-zero emissions. Uranium’s exceptional energy density, advanced reactor designs, renewed political support, and nuclear energy’s ability to provide dependable, scalable, and clean energy are key factors driving its resurgence.

Pierre Debru, Head of Research, Europe, WisdomTree, said: “Nuclear power is increasingly seen to have a significant role to play in the future energy mix due to the political focus on the energy transition, the rise of geopolitical tensions with Russia and China, and the fast-growing energy demand from data centres, AI and cryptocurrencies.” The nuclear theme was added to WisdomTree’s multi-thematic strategy, the WisdomTree Megatrends UCITS ETF, in April 2024.

Debru added, “Defence and security are underrepresented in many portfolios and have faced decades of underinvestment in Europe, resulting in a significant capability gap. A structural shift is underway in Europe as nations increase defence budgets to meet NATO targets and respond to geopolitical challenges. WDEF is the first ETF dedicated to providing exposure to the European defence industry and is built around a timely and urgent theme focused on Europe’s push for strategic autonomy in defence amid rising geopolitical tensions.”

Alexis Marinof, CEO, Europe, WisdomTree, added: “Since launching our first thematic ETF in 2018, we have developed best-in-class research capabilities providing investors with high-quality insights into the themes we offer through our ETFs. Over the years, our thematic capabilities have grown significantly, enabling us to produce foundational white papers that help investors navigate the thematic universe and understand how these investments can fit into their portfolios. The true scale of our research capabilities is reflected in these new launches, which leverage proprietary indices with stock selection grounded in our in-house subject matter expertise. While off-the-shelf indices have a role in portfolios, our focus remains on intelligent ETF innovation—bringing pure-play, differentiated exposures to investors.”

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