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Wall Street extended its three-week decline and tumbled to a seven-week low with the S&P 500 and Dow Jones losing more than 2% each. The combination of woes, including a delay in additional fiscal stimulus package, concerns over fresh lockdowns in Europe amid resurgence in COVID-19 cases, election uncertainty, and rising U.S.-China tensions weighed on investors’ sentiment.
Notably, the S&P 500 is on track for its first monthly loss since March. The benchmark is off more than 8% from its Sep 2 peak (read: 4 Safe ETF Bets as Global Stocks Tumble).
The fresh restriction in Europe has sparked fears over the global economic recovery and thus the stock market. The stay-at-home measures will again put pressure on airline, travel and leisure stocks while lift cloud computing, data center as well as online providers stocks. Investors should note that the first round of lockdowns in March had led the S&P 500 to suffer its worst monthly decline since the global financial crisis.
Further, a report that showed global banks moved allegedly illicit funds over the past two decades despite warnings from U.S. officials also contributed to the market decline. A new investigation by BuzzFeed and the International Consortium of Investigative Journalists found that banks’ internal compliance officers flagged a total of more than $2 trillion in transactions between 1999 and 2017 as possible money laundering or other criminal activity.
Deutsche Bank (DB - Free Report) appears to have facilitated $1.3 trillion of suspicious money in the files, while JPMorgan (JPM - Free Report) disclosed $514 billion, per the report. Other banks mentioned in the investigation include HSBC Holdings, Standard Chartered and Bank of New York Mellon.
That said, the weak trading on Sep 21 led to a few winners with low-risk products but a number of losers from various corners of the investing space. Below we have highlighted some of the ETFs targeting those areas:
Winners
AGFiQ US Market Neutral Momentum Fund – Up 5.3%
This ETF provides exposure to the “momentum” factor by investing long in U.S. equities that have had above-average total returns and shorting those securities that have had below-average total returns. It follows the Dow Jones U.S. Thematic Market Neutral Momentum Index, charging investors 2.32% in annual fees. The product has accumulated $5.9 million in its asset base while trading in average daily volume of 11,000 shares.
AdvisorShares Dorsey Wright Short ETF (DWSH - Free Report) – Up 4.8%
This is an actively managed ETF that short sells U.S. large-cap securities with the highest relative weakness within an investment universe primarily, comprising large-capitalization U.S.-traded equities. It holds 102 stocks in its basket with consumer discretionary taking the largest share at 22.8% while energy and healthcare round off the next two spots. The product trades in lower average daily volume of 133,000 shares and has accumulated $103 million in its asset base. It charges higher annual fee of 3.07% (read: 7 Top ETFs That Trumped Last Week's Market Rout).
It seeks to profit from an increase in the expected volatility of the S&P 500 as measured by the prices of VIX futures contracts. The ETF focuses on the S&P 500 VIX Short-Term Futures Index, which measures the returns of a portfolio of monthly VIX futures contracts with a weighted average of one month to expiration. It has amassed $271.8 million in AUM and charges 85 bps in fees per year. The fund trades in average daily volume of around 4.6 million shares.
WisdomTree Cloud Computing Fund (WCLD - Free Report) – Up 3%
This ETF offers exposure to emerging and fast-growing U.S.-listed companies (including ADRs) that are primarily focused on cloud software and services, and follow the BVP Nasdaq Emerging Cloud Index. It holds 52 stocks in its basket and charges investors 45 bps in fees per year. The product has amassed $716.9 million in its asset base and trades in average daily volume of 767,000 shares. It has a Zacks ETF Rank #2 (Buy) (read: 5 Top-Ranked Tech ETFs to Buy on the Dip).
Losers
SPDR S&P Oil & Gas Equipment & Services ETF (XES - Free Report) – Down 7.5%
This fund tracks the S&P Oil & Gas Equipment & Services Select Industry Index, which measures the performance of the companies engaged in the oil and gas equipment and services industry. Oil & gas equipment & services takes the largest share at 86.1% while oil & gas drilling takes the rest. The product holds 30 stocks in its basket with AUM of $91.3 million. It trades in average daily volume of 105,000 shares a day and charges 35 bps in fees per year from investors.
This ETF follows the S&P Metals and Mining Select Industry and offers a broad exposure to the U.S. metal and mining industry. It holds 23 stocks in its basket with steel firms accounting for nearly half of the portfolio while aluminum and gold round off the next two spots with double-digit exposure each. The fund has 0.35% in expense ratio and has AUM of $626.4 million.
This fund provides exposure to the global airline industry, including airline operators and manufacturers from all over the world, by tracking the U.S. Global Jets Index. In total, the product holds 40 securities and charges investors 60 bps in annual fees. The fund has gathered $1.8 billion in its asset base while seeing solid trading volume of nearly 4.8 million shares a day. It has a Zacks ETF Rank #4 (Sell) with a High risk outlook (read: Is It Again Time to Shift Focus to Cyclical ETFs?).
ETFMG Prime Junior Silver ETF (SILJ - Free Report) – Down 6.4%
SILJ provides direct exposure to the silver mining exploration and production industry by tracking the Prime Junior Silver Miners & Explorers Index. It holds 48 stocks in its basket with Canadian firms taking the lion’s share at 69%, while the United States and Peru take a double-digit exposure each. The fund has managed assets worth $451.9 million and trades in good volume of nearly 1.6 million shares a day. It charges 69 bps in annual fees.
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ETFs Winners & Losers to Start Another Rough Week
Wall Street extended its three-week decline and tumbled to a seven-week low with the S&P 500 and Dow Jones losing more than 2% each. The combination of woes, including a delay in additional fiscal stimulus package, concerns over fresh lockdowns in Europe amid resurgence in COVID-19 cases, election uncertainty, and rising U.S.-China tensions weighed on investors’ sentiment.
Notably, the S&P 500 is on track for its first monthly loss since March. The benchmark is off more than 8% from its Sep 2 peak (read: 4 Safe ETF Bets as Global Stocks Tumble).
The fresh restriction in Europe has sparked fears over the global economic recovery and thus the stock market. The stay-at-home measures will again put pressure on airline, travel and leisure stocks while lift cloud computing, data center as well as online providers stocks. Investors should note that the first round of lockdowns in March had led the S&P 500 to suffer its worst monthly decline since the global financial crisis.
Further, a report that showed global banks moved allegedly illicit funds over the past two decades despite warnings from U.S. officials also contributed to the market decline. A new investigation by BuzzFeed and the International Consortium of Investigative Journalists found that banks’ internal compliance officers flagged a total of more than $2 trillion in transactions between 1999 and 2017 as possible money laundering or other criminal activity.
Deutsche Bank (DB - Free Report) appears to have facilitated $1.3 trillion of suspicious money in the files, while JPMorgan (JPM - Free Report) disclosed $514 billion, per the report. Other banks mentioned in the investigation include HSBC Holdings, Standard Chartered and Bank of New York Mellon.
That said, the weak trading on Sep 21 led to a few winners with low-risk products but a number of losers from various corners of the investing space. Below we have highlighted some of the ETFs targeting those areas:
Winners
AGFiQ US Market Neutral Momentum Fund – Up 5.3%
This ETF provides exposure to the “momentum” factor by investing long in U.S. equities that have had above-average total returns and shorting those securities that have had below-average total returns. It follows the Dow Jones U.S. Thematic Market Neutral Momentum Index, charging investors 2.32% in annual fees. The product has accumulated $5.9 million in its asset base while trading in average daily volume of 11,000 shares.
AdvisorShares Dorsey Wright Short ETF (DWSH - Free Report) – Up 4.8%
This is an actively managed ETF that short sells U.S. large-cap securities with the highest relative weakness within an investment universe primarily, comprising large-capitalization U.S.-traded equities. It holds 102 stocks in its basket with consumer discretionary taking the largest share at 22.8% while energy and healthcare round off the next two spots. The product trades in lower average daily volume of 133,000 shares and has accumulated $103 million in its asset base. It charges higher annual fee of 3.07% (read: 7 Top ETFs That Trumped Last Week's Market Rout).
ProShares VIX Short-Term Futures ETF (VIXY - Free Report) – Up 3.3%
It seeks to profit from an increase in the expected volatility of the S&P 500 as measured by the prices of VIX futures contracts. The ETF focuses on the S&P 500 VIX Short-Term Futures Index, which measures the returns of a portfolio of monthly VIX futures contracts with a weighted average of one month to expiration. It has amassed $271.8 million in AUM and charges 85 bps in fees per year. The fund trades in average daily volume of around 4.6 million shares.
WisdomTree Cloud Computing Fund (WCLD - Free Report) – Up 3%
This ETF offers exposure to emerging and fast-growing U.S.-listed companies (including ADRs) that are primarily focused on cloud software and services, and follow the BVP Nasdaq Emerging Cloud Index. It holds 52 stocks in its basket and charges investors 45 bps in fees per year. The product has amassed $716.9 million in its asset base and trades in average daily volume of 767,000 shares. It has a Zacks ETF Rank #2 (Buy) (read: 5 Top-Ranked Tech ETFs to Buy on the Dip).
Losers
SPDR S&P Oil & Gas Equipment & Services ETF (XES - Free Report) – Down 7.5%
This fund tracks the S&P Oil & Gas Equipment & Services Select Industry Index, which measures the performance of the companies engaged in the oil and gas equipment and services industry. Oil & gas equipment & services takes the largest share at 86.1% while oil & gas drilling takes the rest. The product holds 30 stocks in its basket with AUM of $91.3 million. It trades in average daily volume of 105,000 shares a day and charges 35 bps in fees per year from investors.
SPDR S&P Metals & Mining ETF (XME - Free Report) – Down 7.5%
This ETF follows the S&P Metals and Mining Select Industry and offers a broad exposure to the U.S. metal and mining industry. It holds 23 stocks in its basket with steel firms accounting for nearly half of the portfolio while aluminum and gold round off the next two spots with double-digit exposure each. The fund has 0.35% in expense ratio and has AUM of $626.4 million.
U.S. Global Jets ETF (JETS - Free Report) – Down 6.4%
This fund provides exposure to the global airline industry, including airline operators and manufacturers from all over the world, by tracking the U.S. Global Jets Index. In total, the product holds 40 securities and charges investors 60 bps in annual fees. The fund has gathered $1.8 billion in its asset base while seeing solid trading volume of nearly 4.8 million shares a day. It has a Zacks ETF Rank #4 (Sell) with a High risk outlook (read: Is It Again Time to Shift Focus to Cyclical ETFs?).
ETFMG Prime Junior Silver ETF (SILJ - Free Report) – Down 6.4%
SILJ provides direct exposure to the silver mining exploration and production industry by tracking the Prime Junior Silver Miners & Explorers Index. It holds 48 stocks in its basket with Canadian firms taking the lion’s share at 69%, while the United States and Peru take a double-digit exposure each. The fund has managed assets worth $451.9 million and trades in good volume of nearly 1.6 million shares a day. It charges 69 bps in annual fees.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>