# JETS (US Global Airline ETF)



## Franko (Mar 31, 2012)

Hi folks,

Bit of contrarian play I'm eyeing - what are your thoughts on JETS as a general airline play, with the viral crisis playing out right now. 

Things I like:

- It's sold off heavily, off 60% from highs.
- US airlines have good backing from the US gov't for bailouts, if needed. Hard to picture them all going bankrupt (some may go bankrupt, hence why I don't want to stockpick individual companies. If one goes under, the others will absorb its market share).
- The oil pricing war is providing a good tailwind for airlines by reducing costs.

I'm usually a basic index investor, so have not really strayed beyond that since starting my indexing strategy, but there are deals to be had these days.

Franko


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## fireseeker (Jul 24, 2017)

I think your investing thesis is good. I've been watching JETS, too.

That said, I am 99% deciding to not buy in. This is for one of the reasons you articulate -- as an index investor, why reach for something esoteric? 

It is also because I acknowledge I can't fore see what a bailout will look like. 

In all likelihood, 18 months from now international airlines will be crazy busy. They will be probably be at past max capacity, with tremendous pricing power. 

But will the original equity investors have already been wiped out? That's what a bailout could look like.


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## Franko (Mar 31, 2012)

fireseeker said:


> I think your investing thesis is good. I've been watching JETS, too.
> 
> That said, I am 99% deciding to not buy in. This is for one of the reasons you articulate -- as an index investor, why reach for something esoteric?
> 
> ...


Very good points. I realized this too, upon additional reading. It seems Delta had to file for bankruptcy in the past. Usually these scenarios left shareholders with nothing, as the creditors get first crack at everything. It's very likely the bailout could involve the airlines first dipping into chapter 11, which would wipe out the shareholders, before emerging from bankruptcy to claim their bailout funds.


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