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Top-Ranked ETFs Crushing the S&P 500 to Start 2018
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The momentum seen in 2017 has carried over into this year as the S&P 500 logged in six consecutive records closing in its first six trading sessions, marking the longest winning streak since 1964. However, two separate reports from Bloomberg and Reuters led to some nervousness among investors in the latest trading session (read: S&P 500 Tops 2,700: ETFs & Stocks Outperforming to Start 2018).
The Bloomberg report says that China, the biggest buyer of U.S. sovereign bonds, could slow down or halt its purchase of U.S. Treasuries while the Reuters report suggests that Canadian official expect President Donald Trump will exit the North American Free Trade Agreement. The news has pushed down the stocks, leading to the first drop of 2018 in the U.S. bourses. This pullback could be just a pause in the rally as traders took the chance to book some profits after a record run.
This is because strong market fundamentals remained intact. Another quarter of strong corporate earnings expectation, Trump’s tax overhaul, rising oil prices and slew of upbeat economic data are solidifying the bullishness in the market. Notably, U.S. factory activity, as indicated by the Institute for Supply Management (ISM) index, increased more than expected in December with the second-highest reading in six years buoyed by a surge in new orders growth. Construction spending hit record highs in November with broad-based gains in both private and public outlays (read: ETFs to Buy as U.S. Manufacturing Hits 13-Year High).
The market is expecting companies to come up with rising earnings estimates driven by tax cut savings when they report earnings this quarter. A pick up in the global economy is already fueling growth. The unexpected decision by Bank of Japan to trim its long-dated government bonds purchases signals the strength in the growing Japanese economy.
Given this, investors could tap the latest stock dips with ETFs that have shown strong momentum to start the year and has a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy). Below we have presented a bunch of those that have easily crushed the S&P 500 in the past seven trading sessions and will continue to outperform heading into the strong earnings season.
ProShares S&P 500 Ex-Health Care ETF SPXV – Up 6.1%
This fund offers exposure to the S&P 500 companies, except those in the health care sector. This can easily be done by tracking the S&P 500 Ex-Health Care Index. In total, the fund holds 444 securities in its basket with AUM of $1.4 million. It trades in paltry average daily volume of 233 shares and charges 27 bps in fees per year. The fund has a Zacks ETF Rank #2.
PowerShares Nasdaq Internet Portfolio (PNQI - Free Report) – Up 6%
This fund follows the Nasdaq Internet Index, giving investors exposure to the broad Internet industry. It holds about 84 stocks in its basket with AUM of $496.4 million while charging 60 bps in fees per year. Volume is light as it exchanges around 36,000 shares a day on average. The product has a Zacks ETF Rank #2 (read: Sector ETF & Stock Winners 10-Years Since Great Recession).
This product follows the S&P Semiconductor Select Industry Index and offers exposure to 36 semiconductor firms. It has amassed $364.7 million in its asset base and trades in moderate average volume of around 85,000 shares a day. The product charges 35 bps in fees a year from investors and has a Zacks ETF Rank #1 (read: 5 ETF Ways to Tap Hot Semiconductor Stocks).
PowerShares Russell Midcap Pure Growth Portfolio – Up 4.8%
This ETF offers exposure to the growth corner of the mid-cap segment by tracking the Russell Midcap Pure Growth Index. It holds 98 securities in its basket and charges 39 bps in annual fees. The fund has amassed $122 million in its asset base but trades in a light volume of 13,000 shares a day on average. PXMG has a Zacks ETF Rank #2.
Loncar Cancer Immunotherapy ETF (CNCR - Free Report) – Up 4.7%
This product tracks the Loncar Cancer Immunotherapy Index and provides exposure to the basket of 30 companies that develop therapies to treat cancer by harnessing the body’s own immune system. With AUM of $41 million, the ETF charges 79 bps in annual fees and trades in average daily volume of around 19,000 shares. It has a Zacks ETF Rank #2.
Guggenheim S&P 500 Pure Growth ETF (RPG - Free Report) – Up 4.6%
This ETF follows the S&P 500 Pure Growth Index and offers exposure to 109 growth stocks in the large-cap segment. It has amassed $2.3 billion in its asset base and trades in moderate average volume of around 78,000 shares a day. The product charges 35 bps in fees a year from investors and has a Zacks ETF Rank #1 (read: Top-Ranked Growth ETFs at New Highs to Tap for 2018).
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Top-Ranked ETFs Crushing the S&P 500 to Start 2018
The momentum seen in 2017 has carried over into this year as the S&P 500 logged in six consecutive records closing in its first six trading sessions, marking the longest winning streak since 1964. However, two separate reports from Bloomberg and Reuters led to some nervousness among investors in the latest trading session (read: S&P 500 Tops 2,700: ETFs & Stocks Outperforming to Start 2018).
The Bloomberg report says that China, the biggest buyer of U.S. sovereign bonds, could slow down or halt its purchase of U.S. Treasuries while the Reuters report suggests that Canadian official expect President Donald Trump will exit the North American Free Trade Agreement. The news has pushed down the stocks, leading to the first drop of 2018 in the U.S. bourses. This pullback could be just a pause in the rally as traders took the chance to book some profits after a record run.
This is because strong market fundamentals remained intact. Another quarter of strong corporate earnings expectation, Trump’s tax overhaul, rising oil prices and slew of upbeat economic data are solidifying the bullishness in the market. Notably, U.S. factory activity, as indicated by the Institute for Supply Management (ISM) index, increased more than expected in December with the second-highest reading in six years buoyed by a surge in new orders growth. Construction spending hit record highs in November with broad-based gains in both private and public outlays (read: ETFs to Buy as U.S. Manufacturing Hits 13-Year High).
The market is expecting companies to come up with rising earnings estimates driven by tax cut savings when they report earnings this quarter. A pick up in the global economy is already fueling growth. The unexpected decision by Bank of Japan to trim its long-dated government bonds purchases signals the strength in the growing Japanese economy.
Given this, investors could tap the latest stock dips with ETFs that have shown strong momentum to start the year and has a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy). Below we have presented a bunch of those that have easily crushed the S&P 500 in the past seven trading sessions and will continue to outperform heading into the strong earnings season.
ProShares S&P 500 Ex-Health Care ETF SPXV – Up 6.1%
This fund offers exposure to the S&P 500 companies, except those in the health care sector. This can easily be done by tracking the S&P 500 Ex-Health Care Index. In total, the fund holds 444 securities in its basket with AUM of $1.4 million. It trades in paltry average daily volume of 233 shares and charges 27 bps in fees per year. The fund has a Zacks ETF Rank #2.
PowerShares Nasdaq Internet Portfolio (PNQI - Free Report) – Up 6%
This fund follows the Nasdaq Internet Index, giving investors exposure to the broad Internet industry. It holds about 84 stocks in its basket with AUM of $496.4 million while charging 60 bps in fees per year. Volume is light as it exchanges around 36,000 shares a day on average. The product has a Zacks ETF Rank #2 (read: Sector ETF & Stock Winners 10-Years Since Great Recession).
SPDR S&P Semiconductor ETF (XSD - Free Report) – Up 5.5%
This product follows the S&P Semiconductor Select Industry Index and offers exposure to 36 semiconductor firms. It has amassed $364.7 million in its asset base and trades in moderate average volume of around 85,000 shares a day. The product charges 35 bps in fees a year from investors and has a Zacks ETF Rank #1 (read: 5 ETF Ways to Tap Hot Semiconductor Stocks).
PowerShares Russell Midcap Pure Growth Portfolio – Up 4.8%
This ETF offers exposure to the growth corner of the mid-cap segment by tracking the Russell Midcap Pure Growth Index. It holds 98 securities in its basket and charges 39 bps in annual fees. The fund has amassed $122 million in its asset base but trades in a light volume of 13,000 shares a day on average. PXMG has a Zacks ETF Rank #2.
Loncar Cancer Immunotherapy ETF (CNCR - Free Report) – Up 4.7%
This product tracks the Loncar Cancer Immunotherapy Index and provides exposure to the basket of 30 companies that develop therapies to treat cancer by harnessing the body’s own immune system. With AUM of $41 million, the ETF charges 79 bps in annual fees and trades in average daily volume of around 19,000 shares. It has a Zacks ETF Rank #2.
Guggenheim S&P 500 Pure Growth ETF (RPG - Free Report) – Up 4.6%
This ETF follows the S&P 500 Pure Growth Index and offers exposure to 109 growth stocks in the large-cap segment. It has amassed $2.3 billion in its asset base and trades in moderate average volume of around 78,000 shares a day. The product charges 35 bps in fees a year from investors and has a Zacks ETF Rank #1 (read: Top-Ranked Growth ETFs at New Highs to Tap for 2018).
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 >>