With the rise of e-commerce and supply chain needs, the trucking industry has seen rapid growth and offers attractive investment opportunities. However, you don’t need to be a truck driver to invest in this industry. There are several ways for non-drivers to gain exposure to the trucking sector. In this article, we will explore 4 methods to invest in trucking without having to drive trucks yourself.
Invest in trucking stocks
The most direct way to invest in trucking is to buy stocks of publicly traded trucking and logistics companies like J.B. Hunt, Old Dominion Freight Line, Knight-Swift Transportation, etc. Research the major players, analyze their financials and growth prospects, and build a portfolio of quality trucking stocks. With adequate diversification, this allows you to benefit from the industry’s continued growth.
Invest in trucking ETFs
Exchange-traded funds (ETFs) that track trucking indexes or sectors provide instant diversification and ease of trading. Examples include the First Trust NASDAQ Transportation ETF (FTXR) and the SPDR S&P Transportation ETF (XTN) which have significant exposure to trucking and logistics stocks. Investing in these specialized ETFs offers a low-cost way to invest in trucking.
Invest in truck stops and infrastruture
Companies that own and operate truck stops and transportation infrastructure are another way to invest in the trucking industry without driving trucks. For instance, TravelCenters of America (TA) operates truck stops across the US. REITs like InfraREIT (HIFR) own power transmission assets that provide electricity to railways and highways. Investing in these types of companies allows you to benefit from the essential infrastructure needed to support trucking operations.
Invest through private equity
For accredited investors, private equity funds that specialize in transportation and logistics present an opportunity to invest directly in private trucking companies. These private investments provide exposure to trucking firms in their early growth stages as well as established companies looking for additional capital to expand their fleets and operations. The minimum investments are much higher but may generate superior returns.
In summary, investing in public trucking stocks and ETFs, truck stop operators and transportation infrastructure companies, as well as private equity funds allows non-drivers to gain investment exposure to the growing trucking industry.