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After a wild ride in the first two weeks of March, Wall Street rallied following the Fed’s decision to hike interest rates for the first time since 2018, with more to come. The S&P 500 outperformed last month, gaining 3.6%, while the Dow Jones and the Nasdaq Composite Index advanced 2.3% and 3.4%, respectively.
Against such a backdrop, ETFs from a few sectors have generated strong returns. These are SPDR S&P Oil & Gas Exploration & Production ETF (XOP - Free Report) , Simplify Volt Robocar Disruption and Tech ETF (VCAR - Free Report) , ALPS Clean Energy ETF (ACES - Free Report) , SPDR S&P Metals & Mining ETF (XME - Free Report) and North Shore Global Uranium Mining ETF (URNM - Free Report) .
Current Trends
The central bank raised rates by 25 basis points (bps) to 0.25-0.50% and signaled hikes in all the six remaining meetings this year to tackle the fastest inflation in four decades even as risks to economic growth mount. Fed Chair Jerome Powell showed confidence that the American economy is strong enough to withstand a tighter monetary policy. This has renewed investors’ interest in riskier assets (read: ETFs to Buy on Latest Fed Rate Hike and More Hereafter).
Additionally, optimism about a possible peace deal between Ukraine and Russia helped stocks. However, hopes faded as President Vladimir Putin threatened to halt contracts supplying Europe with a third of its gas unless they are paid in ruble. So, a hawkish Fed and the war in Ukraine dented investors’ confidence.
SPDR S&P Oil & Gas Exploration & Production ETF (XOP - Free Report) – Up 21.6%
SPDR S&P Oil & Gas Exploration & Production ETF provides exposure to 61 oil and gas exploration and production companies by tracking the S&P Oil & Gas Exploration & Production Select Industry Index.
SPDR S&P Oil & Gas Exploration & Production ETF has AUM of $5.5 billion and trades in an average daily volume of 11 million shares. The fund charges 35 bps in fees per year and has a Zacks ETF Rank #3 (Hold) with a High risk outlook (read: Best-Performing Stocks of the Top ETF of March).
Simplify Volt Robocar Disruption and Tech ETF (VCAR - Free Report) – Up 19.8%
Simplify Volt Robocar Disruption and Tech ETF is an actively managed ETF, seeking concentrated exposure to the leader of autonomous driving technology and then enhancing the concentrated exposure with options.
Simplify Volt Robocar Disruption and Tech ETF seeks to boost its performance during extreme moves in Tesla, charging investors 0.95% in annual fees. It has accumulated $9.3 million in its asset base while trading in an average daily volume of 14,000 shares.
ALPS Clean Energy ETF seeks to track the performance of an index comprising U.S. and Canada-based companies that primarily operate in the clean energy sector. It follows the CIBC Atlas Clean Energy Index. The ETF holds 48 securities in its basket with none making up for more than 5.6% share.
ALPS Clean Energy ETF has amassed $853 million in its asset base and charges 55 bps in fees per year from investors.
SPDR S&P Metals & Mining ETF offers broad exposure to the U.S. metal and mining industry by tracking the S&P Metals and Mining Select Industry. It holds 32 stocks in its basket, with steel firms accounting for 42.8% of the portfolio, while coal & consumable fuels, aluminum and gold round off the next two spots with a double-digit exposure each.
SPDR S&P Metals & Mining ETF has 0.35% in expense ratio and AUM of $3.5 billion. It trades in an average daily volume around 7.5 million shares (read: Top and Flop ETFs of Q1).
North Shore Global Uranium Mining ETF (URNM - Free Report) – Up 16.5%
North Shore Global Uranium Mining ETF provides exposure to companies involved in the mining, exploration, development and production of uranium, as well as companies that hold physical uranium or other non-mining assets. It follows the North Shore Global Uranium Mining Index and charges investors 85 bps in annual fee.
North Shore Global Uranium Mining ETF holds 38 stocks in its basket and has accumulated $1 billion in its asset base. It trades in a good volume of 383,000 shares per day on average.
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5 Best Sector ETFs of March
After a wild ride in the first two weeks of March, Wall Street rallied following the Fed’s decision to hike interest rates for the first time since 2018, with more to come. The S&P 500 outperformed last month, gaining 3.6%, while the Dow Jones and the Nasdaq Composite Index advanced 2.3% and 3.4%, respectively.
Against such a backdrop, ETFs from a few sectors have generated strong returns. These are SPDR S&P Oil & Gas Exploration & Production ETF (XOP - Free Report) , Simplify Volt Robocar Disruption and Tech ETF (VCAR - Free Report) , ALPS Clean Energy ETF (ACES - Free Report) , SPDR S&P Metals & Mining ETF (XME - Free Report) and North Shore Global Uranium Mining ETF (URNM - Free Report) .
Current Trends
The central bank raised rates by 25 basis points (bps) to 0.25-0.50% and signaled hikes in all the six remaining meetings this year to tackle the fastest inflation in four decades even as risks to economic growth mount. Fed Chair Jerome Powell showed confidence that the American economy is strong enough to withstand a tighter monetary policy. This has renewed investors’ interest in riskier assets (read: ETFs to Buy on Latest Fed Rate Hike and More Hereafter).
Additionally, optimism about a possible peace deal between Ukraine and Russia helped stocks. However, hopes faded as President Vladimir Putin threatened to halt contracts supplying Europe with a third of its gas unless they are paid in ruble. So, a hawkish Fed and the war in Ukraine dented investors’ confidence.
SPDR S&P Oil & Gas Exploration & Production ETF (XOP - Free Report) – Up 21.6%
SPDR S&P Oil & Gas Exploration & Production ETF provides exposure to 61 oil and gas exploration and production companies by tracking the S&P Oil & Gas Exploration & Production Select Industry Index.
SPDR S&P Oil & Gas Exploration & Production ETF has AUM of $5.5 billion and trades in an average daily volume of 11 million shares. The fund charges 35 bps in fees per year and has a Zacks ETF Rank #3 (Hold) with a High risk outlook (read: Best-Performing Stocks of the Top ETF of March).
Simplify Volt Robocar Disruption and Tech ETF (VCAR - Free Report) – Up 19.8%
Simplify Volt Robocar Disruption and Tech ETF is an actively managed ETF, seeking concentrated exposure to the leader of autonomous driving technology and then enhancing the concentrated exposure with options.
Simplify Volt Robocar Disruption and Tech ETF seeks to boost its performance during extreme moves in Tesla, charging investors 0.95% in annual fees. It has accumulated $9.3 million in its asset base while trading in an average daily volume of 14,000 shares.
ALPS Clean Energy ETF (ACES - Free Report) – Up 19.1%
ALPS Clean Energy ETF seeks to track the performance of an index comprising U.S. and Canada-based companies that primarily operate in the clean energy sector. It follows the CIBC Atlas Clean Energy Index. The ETF holds 48 securities in its basket with none making up for more than 5.6% share.
ALPS Clean Energy ETF has amassed $853 million in its asset base and charges 55 bps in fees per year from investors.
SPDR S&P Metals & Mining ETF (XME - Free Report) – Up 18.5%
SPDR S&P Metals & Mining ETF offers broad exposure to the U.S. metal and mining industry by tracking the S&P Metals and Mining Select Industry. It holds 32 stocks in its basket, with steel firms accounting for 42.8% of the portfolio, while coal & consumable fuels, aluminum and gold round off the next two spots with a double-digit exposure each.
SPDR S&P Metals & Mining ETF has 0.35% in expense ratio and AUM of $3.5 billion. It trades in an average daily volume around 7.5 million shares (read: Top and Flop ETFs of Q1).
North Shore Global Uranium Mining ETF (URNM - Free Report) – Up 16.5%
North Shore Global Uranium Mining ETF provides exposure to companies involved in the mining, exploration, development and production of uranium, as well as companies that hold physical uranium or other non-mining assets. It follows the North Shore Global Uranium Mining Index and charges investors 85 bps in annual fee.
North Shore Global Uranium Mining ETF holds 38 stocks in its basket and has accumulated $1 billion in its asset base. It trades in a good volume of 383,000 shares per day on average.