U.S. Global Investors (NASDAQ:GROW) CEO Frank Holmes talked with Proactive about the growing travel sector, highlighting the performance of Trip ETF and Jets ETF, and the impact of AI on travel pricing.
Holmes explained that Trip ETF, listed on the London Stock Exchange, offers broader exposure to hotels, cruise lines, and the hospitality sector, while Jets ETF remains focused on airlines and is listed on the New York Stock Exchange.
Proactive: All right. Welcome back inside our Proactive newsroom. And joining me now is Frank Holmes. He is the CEO of US Global Investors. And Frank, it's always great to have you back. How are you?
Frank Holmes: Outstanding, my friend.
Good. I know you got your Jets hat on, but we're actually talking about your ETF, Trip, and the difference between the two.
Yes. Trip is only listed on the London Stock Exchange. We merged with another fund a year ago. Jets itself is still on the New York Stock Exchange and throughout Latin America. The big difference, as you mentioned, is important. The Trips hats haven’t arrived yet, but when they do, I’ll wear mine.
Trip is more comprehensive, covering the hotel business, shipping, and cruise lines. Cruise lines have been featured in Investors Business Daily for their strong growth momentum. They’ve really contributed to overall performance, which is key for investors focused on this sector.
Yeah, the digital nomad lifestyle continues to be popular. Many people are looking for different ways to travel, whether for vacation or business.
Exactly. And corporations are pushing employees to return to the office to regain that human element. But there’s a quiet protest—nearly 40 million people under 40, including software coders and marketing experts, want to experience the world while working remotely.
They’re flying to Europe, especially Spain and Portugal. Spain, in particular, has much faster internet speeds compared to Italy and Greece. That’s why Germans and Swedes prefer Spain and Portugal.
In Asia, during winter, people leave South Korea and Japan to work remotely in Thailand and Vietnam. In the summer, they return to Japan and South Korea, continuing their work while enjoying cultural experiences.
Consumer spending on travel is expected to increase in 2025. Are we surpassing pre-COVID levels, or are we getting close?
Oh, we’re well past it. The concept of low seasons is disappearing. Previously, you’d book hotels and flights a year in advance based on high or low seasons. Now, it's either high season or very high season.
For example, when I was in Spain, all the hotels were fully booked. If you wanted to visit a museum, you had to prepay a month in advance. Otherwise, no ticket. Before COVID, Park Güell in Barcelona was free. Now, it costs €23. Just a year ago, it was €11.
Price inflation on these attractions is incredible, yet they’re still sold out. People are treating visits to museums like going to Disney World, which is far more expensive. I saw this particularly in Madrid and Barcelona.
Yeah. You mentioned your travels. Let’s talk about AI in travel. How does it fit in?
Travel companies use AI for pricing. If you repeatedly check the price of a ticket on the same server, the system raises the price. But if you check from a different server, you might see a lower price—that’s AI at work.
AI has also reduced lost luggage incidents by improving baggage tracking. For remote workers and digital nomads, AI-powered tools enhance efficiency and connectivity.
More people traveling and working remotely impacts ticket pricing. Flights are packed, and extra seats are gone. Looking a year ahead, there are no discounts when booking flights with major airlines like Delta, American Airlines, or EasyJet.
Yeah, in Canada, flying to Las Vegas used to be cheap—around $200 or $300 for a flight and hotel. That’s not the case anymore.
Not at all. Vegas has changed. More money is now spent on entertainment than gambling, making the city much more expensive. Restaurants are packed, and people just want to be there.
Since COVID, this shift isn’t going away. Museums that were once empty are now fully booked. Even in Bangkok, you now have to book museum tickets online in advance.
Despite rising travel costs, airline and cruise stocks remain relatively inexpensive compared to tech stocks. Tech companies are expensive, but their employees are among the biggest travelers. So, for investors, airline, hotel, and cruise stocks offer better value.
And that’s where the Trip ETF fits in?
Exactly. Global spending remains a strong tailwind for the industry. Even in China, where economic issues persist, Xi Jinping recently met with tech leaders he had been cracking down on since 2018. Those tech stocks rallied, and with more capital, Chinese travelers will start spending again.
In Madrid and Barcelona, I saw long queues of Asian travelers at hotels. That’s another positive sign for the global travel industry.
Quotes have been edited for clarity and style