The First Trust RBA American Industrial Renaissance ETF (NASDAQ:AIRR) and the Global X U.S. Infrastructure Development ETF (NYSEARCA:PAVE) both pitch investors on the same story: US reshoring, factory buildouts, electrification, and a multi-year capex cycle. They look like substitutes, but they bet on different slices of the same theme. Over the past year, AIRR returned 62.89% while PAVE returned 36.66%, a gap that exists because these funds are betting on different parts of the same theme.
What each fund is actually betting on
AIRR is a concentrated wager on US small and mid-cap industrial execution. The portfolio holds 51 positions, with the top 10 representing roughly 37.5% of assets. The biggest names are the companies that physically build the infrastructure: Argan at 4.89%, MasTec at 4.65%, Comfort Systems at 4.18%, and Sterling Infrastructure at 3.96%. It also carries a meaningful sleeve of regional banks (FNB, Old National, Wintrust, Associated, Fulton, First Financial), which makes the fund implicitly long a steeper yield curve and local commercial lending demand.
PAVE plays the same theme from one rung up the value chain. It holds 119 equity positions with net assets of $12.4 billion, and its top holdings are large-cap industrial blue chips: Deere at 3.39%, Howmet at 3.39%, Quanta Services at 3.37%, Trane Technologies at 3.33%, CSX at 3.35%, Union Pacific at 3.22%, and Eaton at 3.16%. Railroads, building materials (Vulcan, Martin Marietta, CRH), and machinery dominate. PAVE wins when the broader industrial complex re-rates. AIRR wins when small-cap contractors and electrical/mechanical specialists capture the actual project spend.
Where the difference shows up
The divergence is in the numbers. Year to date, AIRR is up 32.79% versus PAVE at 22.22%, with the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) up just 7.53%. Over five years, AIRR has returned 218.72% against PAVE's 134.10% and the S&P's 71.88%. AIRR's smaller-cap tilt has paid handsomely as data center buildouts and grid upgrades have flowed directly into the contractors' backlogs. The flip side: AIRR's concentration and small-cap beta mean it will fall harder if industrial capex stalls or credit conditions tighten on its regional banks.
Practical comparison
| Factor | AIRR | PAVE |
|---|---|---|
| Net assets | $8.4B | $12.4B |
| Holdings | 51 | 120 |
| Market-cap tilt | Small/mid-cap | Large/mid-cap |
| Top 10 concentration | ~37.5% | ~31.5% |
| Largest position | Argan (4.89%) | Deere (3.39%) |
| 1-year return | 62.89% | 36.66% |
| 5-year return | 218.72% | 134.10% |
PAVE also carries international exposure through CRH, Eaton, Trane, and Amrize, which dilutes the pure-play US thesis somewhat. AIRR is entirely domestic by design.
The verdict
For an investor whose actual thesis is US reshoring and the boots-on-the-ground capex cycle, AIRR is the cleaner expression. It holds the contractors, electrical specialists, and HVAC installers booking the work, with small-cap leverage and a regional-bank sleeve that compounds the bet. PAVE is the better choice for investors who want infrastructure exposure with lower drawdown risk, broader diversification across 120 names, and large-cap liquidity, accepting that returns will track a more index-like outcome. What would flip the call: a small-cap credit shock or a sharp slowdown in non-residential construction would punish AIRR first and hardest. PAVE's railroads and building-materials majors would absorb that hit with far more cushion.
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