Space is increasingly recognized as a major investment frontier, with the global space economy projected to grow from around $600 billion in 2025 to $1.8 trillion by 2035, according to McKinsey estimates. This expansion is driven by declining launch costs, reusable rocket technology, and a shift from government-led exploration to private commercialization.
This expansion stems from satellite communications, Earth observation, defense applications, and emerging fields like in-orbit manufacturing and space tourism. Private investment has fueled much of this progress, with companies like SpaceX leading the development of reusable rocket technology that has dramatically lowered costs.
“Space may be the final frontier, but it’s made in a Hollywood basement.”
- Red Hot Chili Peppers
The top space-related ETFs we track are up 40% to 50% in 2026, vastly outpacing the Nasdaq's 14% YTD gain. Zooming out a little more reveals gains of more than 100% in the past year alone!
A major 2026 catalyst could be SpaceX's IPO, which could value the company at over $1 trillion and boost the entire sector. The first trading day for SpaceX could be as early as June 12, 2026, on the Nasdaq under the ticker SPCX.
Increased defense spending, commercial satellite mega-constellations, and orbital infrastructure projects further support growth. Advances in AI, reusable tech, and in-space services create new revenue streams for space-related stocks well into the future.
The sector carries significant risks. Many pure-plays remain unprofitable and face high capital needs, leading to dilution. Technical failures, launch delays, and regulatory hurdles are common. Orbital debris, supply chain issues, and intense competition (especially from SpaceX) add challenges.
Much like the rockets themselves, the sector can get overheated at times. Valuations for hot names like RKLB can appear stretched, pricing in perfection. Risk-averse investors should approach the sector with a long-term horizon and diversified portfolios.
The top way to get diversified exposure is via the Procure Space ETF (UFO). This is a pure-play space ETF tracking companies in satellite communications, rockets, Earth observation, and related services. This ETF is up 46% year-to-date in 2026 and more than 135% over the past year!
The chart for UFO is looking overbought, so it might be wise to wait for a pullback. The ETF is trading at the top of its trend channel, well above the key exponential moving averages that we track. The RSI at 64 is near overbought levels, but has some room to keep running in the near term.
Some of the top individual names to consider include:
Rocket Lab USA (RKLB) stands out as a leading pure-play. Often called a "mini-SpaceX," it offers small-to-medium launch services using the Electron rocket and is developing the larger Neutron vehicle. The company has secured major contracts, including with the U.S. Space Development Agency, and its stock has delivered extraordinary returns amid rising launch demand.
AST SpaceMobile (ASTS) pursues an ambitious direct-to-device satellite broadband network, aiming to provide cellular coverage worldwide without specialized hardware. Backed by partnerships with AT&T, Verizon, and T-Mobile, it targets massive revenue growth as it deploys its constellation.
Planet Labs (PL) specializes in Earth observation, delivering daily satellite imagery for agriculture, defense, and climate monitoring. Its data services benefit from growing demand across industries.
Investing in space stocks means betting on humanity's expansion beyond Earth. With strong tailwinds from technology, policy, and commercialization, the sector promises substantial rewards for those who navigate its risks.
My favorite space ETF is a much smaller fund that was recently launched. I pair it with another space ETF that offers investors one of the few ways to gain exposure to SpaceX through a publicly listed equity. To get all of my investment research, top picks across multiple sectors, portfolios, newsletters, and trade alerts, use the link below:
Jason Hamlin, Founder, Nicoya Research
