HANetf Launches Europe’s First Pureplay Drones UCITS ETF

This is the first UCITS ETF in Europe with pure exposure to the drone and unmanned aerial vehicle (UAV) sector .

Index Methodology

The Drone UCITS ETF replicates the VettaFi Drone UCITS Index, which applies a selection criterion based on revenue stream purity . The methodology distinguishes two categories of companies:

Pure-play: companies with at least 50% of revenues derived from drones or enabling technologies

Diversified: companies with at least 20% exposure to drones or dedicated UAV divisions

The allocation provides for 80% of the portfolio in pure-play companies and a maximum of 20% in diversified aerospace and defence companies, with position caps to maintain diversification and liquidity . This approach reduces the dilution typical of broad-market defence indices, where large prime contractors weigh disproportionately.

Portfolio Composition

The top five positions represent approximately 75% of the portfolio :

Remaining positions include AIRO Group Holdings (2.98%), Draganfly (2.26%), Palantir Technologies (2.17%), General Electric (2.07%) and RTX Corp (1.80%).

The sector breakdown shows Industrials at 85.05% and Technology at 14.87% . Geographically, the United States represents 79.95% of exposure, followed by China (12.50%), Canada (3.17%), France (1.04%), Israel (0.66%), United Kingdom (0.59%), Sweden (0.56%), Italy (0.55%) and Germany (0.52%) .

Market Drivers

The launch comes in a context of structural sector growth. According to GSBR Research, the global UAV market will grow 16.77% annually over the next decade, reaching approximately $209.91 billion . Military drone spending is projected at $216.5 billion over the next ten years .

The civil UAS market is expected to grow from $10.1 billion in 2024 to $20.6 billion by 2033, with a CAGR of 6.8% . The commercial UAS segment alone will reach $9.5 billion by 2028, with civil applications growing faster than military demand .

Tom Bailey, Head of Research at HANetf, stated: “Over the past few years, drones have come to dominate the battlefield in Ukraine and global defence spending is changing to reflect this. The United States has launched a $1 billion ‘Drone Dominance’ initiative, Germany plans to field more than 8,000 unmanned systems by 2029, and the UK has committed an additional £2 billion to drone capabilities. But defence is only one of the three growth pillars. Governments are increasingly deploying drones for disaster relief, border security and infrastructure monitoring. At the same time, as hardware costs fall and autonomy improves, commercial applications are expanding rapidly. Commercial drone use is expected to grow faster than military demand over the coming decade, with adoption accelerating across construction, industrial inspection, agriculture and logistics, where drones offer detailed surveillance and lower-cost transportation solutions. The drone investment theme is not a derivative of the defence spending boom but reflects the broader integration of unmanned aviation systems across military, civil and commercial activities.”

Peter Diel, Head of Index Product Europe at VettaFi, commented: “Autonomous systems deliver a real asymmetric advantage across a multitude of sectors, driving increased demand in areas ranging from supply chain optimization, entertainment and consumer products to fast-growing defense and security applications. We are thrilled to partner with HANetf to bring this highly focused, innovative investment opportunity to the UCITS market.”

Risk Profile

The KIID document highlights several specific risk factors :

• Thematic ETFs have concentrated exposure on limited sectors, with potential high volatility
• Capital is fully at risk
• Currency exchange can impact returns positively or negatively
• The drone market is nascent, competitive and subject to rapid technological change
• Sector companies depend on national defence budgets, export approvals and geopolitical priorities
• Producers with military exposure are subject to export control regimes, sanctions and anti-corruption and anti-money laundering compliance obligations

HANetf Context

HANetf operates as a white-label UCITS ETF and ETC platform in Europe . The Drone ETF launch follows that of the Ukraine Reconstruction UCITS ETF, announced on 12 March 2026 . HANetf’s defence range also includes the Future of Defence Screened UCITS ETF (NATE), an ESG version of the $3 billion global defence fund .

The fund is registered for distribution in Austria, Denmark, Finland, France, Germany, Ireland, Italy, Luxembourg, Netherlands, Norway, Sweden and the United Kingdom . It is UCITS compliant, ISA and SIPP eligible, and maintains UK Fund Reporting status .

Considerations for Investors

The Drone UCITS ETF offers direct exposure to a market segment in structural expansion. The pureplay methodology distinguishes the product from traditional defence indices, where drone exposure is diluted by the presence of large aerospace contractors.

Geographic concentration on the United States (nearly 80%) and the presence of significant weight in top holdings imply a volatility profile above average. Pure-play companies in the portfolio have recorded significant performance over the past year: Red Cat +185.6%, Ondas +1,074.2%, AeroVironment +61.6% .

The 0.69% TER sits in the mid-range for UCITS thematic ETFs. Physical replication and quarterly rebalancing ensure transparency and alignment with the underlying index.