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Change-traded funds (ETFs) supply buyers a low-cost method to purchase a basket of shares in a single fell swoop. I significantly like sector and thematic ETFs, as they supply concentrated publicity with out the necessity to choose and monitor particular person shares.
Listed here are two such funds that I reckon are value contemplating for a Shares and Shares ISA in 2026.
Robotics revolution
Let’s begin with the iShares Automation & Robotics ETF (LSE:RBTX). This one does what it says on the tin actually, providing publicity to 137 shares related to the event of automation and robotic know-how.
It’s no shock then that we see Nvidia among the many prime holdings, as fashionable robotics is inseparable from AI, and that’s at the moment inseparable from Nvidia.
Take the corporate’s Cosmos platform, for instance. It’s purpose-built for bodily AI, enabling main builders to make use of Nvidia’s software program to speed up the event of self-driving vehicles and robots. The checklist of consumers speaks for itself.
Supply: Nvidia
Nonetheless, the biggest holding within the ETF, carrying a weighting of 5.2%, is Advantest. This Japanese firm is the world chief in semiconductor computerized check tools. Mainly, earlier than any chip is positioned inside a robotic, it should go via an Advantest machine, making the agency a form of {hardware} gatekeeper.
Elsewhere within the portfolio are chipmakers Intel and Superior Micro Gadgets, in addition to Rockwell Automation and surgical robotic pioneer Intuitive Surgical. So it holds a variety of shares throughout the worldwide robotics ecosystem.
Regardless of the ETF’s various holdings, any popping of the scary ‘AI bubble’ would doubtless harm efficiency for some time. In the meantime, additional tit-for-tat tariffs may gasoline inflation and squeeze provide chains, doubtlessly slowing the business’s progress.
Nonetheless, with self-driving vehicles and robots nonetheless early of their improvement, I count on this one to carry out nicely for a really very long time to return.
The ETF is up greater than 200% since launch in 2016, and there’s an ongoing cost of 0.4%.
UK property
Turning to a really totally different concept now with iShares MSCI Goal UK Actual Property ETF (LSE:UKRE). This fund is invested in 28 UK actual property funding trusts (REITs), property corporations, and stuck earnings securities.
Now, this one hasn’t carried out nicely lately. For the reason that begin of 2022, when rates of interest first began capturing up, the share value has slumped by 36%.
This fall displays the challenges increased rates of interest pose for REITs, together with elevated debt-servicing prices and a dearer surroundings for increasing property portfolios. These dangers stay, which is mirrored in a near-record low for the ETF’s share value.
Nonetheless, the potential reward for taking up this threat is a chunky 6.5% dividend yield. And whereas there’s no assure all its underlying REITs pays their dividends, the fund additionally has round 40% of the portfolio in UK inflation-linked authorities bonds, which offer a much more defensive earnings stream.
Wanting forward, rates of interest are anticipated to maintain falling subsequent 12 months, which might assist REITs cut back the price of their giant money owed. This might increase sentiment for high-quality REITs like Londonmetric Property, which makes up greater than 6.5% of the ETF.
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