Should you invest in electric vehicle ETFs?

Proposed vehicle emission standards by the U.S. Environmental Protection Agency (EPA) are driving market transformations. Investors can choose to invest in electric car stocks or EV battery manufacturers. However, considering the uncertainty in the industry, it's wise to explore electric vehicle ETFs for a diversified approach.

Should you invest in EV charging stocks?

According to a Technavio report, the EV charging station market is expected to grow at a 31% CAGR between 2021 – 2025. Because it’s challenging to select the best stock in the crowded EV charging space, investors looking to capitalize on the industry’s growth in a less risky way could bet on quality ETFs exposed to EV charging stocks.

Which EV ETF should you invest in?

Another EV ETF to consider is DRIV, which tracks the Solactive Autonomous & Electric Vehicles Index. This ETF has less of a pure-play EV focus, with shares of semiconductor manufacturer Nvidia Corp. ( NVDA) currently leading the portfolio. However, it does feature shares of Tesla in addition to traditional automakers like Toyota Motor Corp. ( TM ).