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Market-Beating, Top-Ranked ETFs of the Longest Bull Market
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The U.S. bull market is now the longest ever, stretching 3,453 days or nine and-a-half years, surpassing the 3,452-day record set during Sep 11, 1990 to Mar 24, 2000. This means that the index never slipped to the bear territory (decline of 20%) though it witnessed correction many times (a decline of 10%) triggered by the downgrade of America's credit rating in 2011, the collapse of the euro, Greece turmoil, Japan’s recession, China's alarming economic slowdown, the oil price carnage, recent tech sell-off, inflation threats and the U.S.-China trade turmoil.
Given these hurdles, this longest bull market has been unable to become the most powerful one with gains of 324% for the S&P 500, just behind the 417% rally seen during the 1990-2000 run. Notably, the index has created about $18 trillion in wealth since it bottomed on Mar 9, 2009. The solid run has been mainly driven by the technology surge and an unprecedented era of cheap money from low interest rates. As such, the tech-heavy Nasdaq Composite Index is the biggest winner of this bull market, jumping 611%. The Dow Jones Industrial Average has gained about 300% from around a low of 6,500 to nearly 26,000 (read: S&P 500 on Track for Longest Bull Run: How to Trade With ETFs).
The bull run will likely continue for more months as the U.S. economy is witnessing the fastest pace of growth in nearly four years, with a nearly two-decade low unemployment rate of 3.9%, historic tax cuts, higher government spending, deregulation, rising consumer confidence and higher spending. Per Trump, “the United States is on track to hit the highest annual growth rate in over 13 years.”
Further, corporate profits are surging and Q2 double-digit earnings growth is expected to be the highest quarterly growth pace in almost eight years. For full-year 2018, total earnings for the S&P 500 index are expected to be up 20.6% on 6.3% higher revenues.
While there have been winners in many corners of the space, several ETFs have easily crushed the S&P 500 by wide margins. Below, we have presented a bunch of top performing ETFs of the longest bull market that will continue to outperform in the coming months given that these have a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy).
First Trust Dow Jones Internet Index Fund (FDN - Free Report) – Up 873%
This fund targets the Internet corner of the broad technology space with AUM of $9.3 billion and average daily volume of around 649,000 shares. The fund follows the Dow Jones Internet Composite Index and holds 41 stocks in its basket. Expense ratio comes in at 0.53%. The fund has a Zacks ETF Rank #1 (read: Social Media Dives: Time to Buy the Dip With ETFs?).
This fund offers exposure to the largest and most liquid U.S.-listed companies engaged in Internet-related businesses by tracking the Nasdaq Internet Index. It holds about 95 stocks and charges 60 bps in annual fees. The ETF has AUM of $658.1 million and trades in a lower volume of around 44,000 shares a day. The product has a Zacks ETF Rank #1.
First Trust NYSE Arca Biotechnology Index Fund (FBT - Free Report) – Up 715%
The fund follows the NYSE Arca Biotechnology Index, which measures the performance of a cross section of companies in the biotechnology industry that are primarily involved in the use of biological processes to develop products or provide services. With AUM of $2.2 billion, it holds 30 stocks in its basket, charging 0.56% in annual fees. The fund trades in a moderate average daily volume of 87,000 shares and carries a Zacks ETF Rank #2 (read: What Investors Need to Know about Biotech ETFs).
iShares U.S. Aerospace & Defense ETF (ITA - Free Report) – Up 562%
This fund offers exposure to 38 U.S. companies that manufacture commercial and military aircraft and other defense equipment. It follows the Dow Jones U.S. Select Aerospace & Defense Index and charges 43 bps in fees per year. The fund has accumulated $5.8 billion in AUM and trades in good volume of around 296,000 shares. It has a Zacks ETF Rank #2 (read: 4 Sector ETFs to Tap at New Highs).
First Trust NASDAQ-100-Technology Sector Index Fund (QTEC - Free Report) – Up 549%
This ETF offers broad exposure to the technology sector by tracking the NASDAQ-100 Technology Sector Index. It holds 37 stocks in its basket with AUM of $2.6 billion and average daily volume of around 180,000 shares. It charges 58 bps in annual fees and has a Zacks ETF Rank #1.
Invesco Dynamic Software ETF – Up 541%
This ETF provides exposure to 30 software segment of the broader U.S. technology space and holds a small basket of 30 stocks. It charges 63 bps in annual fees and has AUM of $251.1 million. The product sees lower average daily volume of 22,000 shares and has a Zacks ETF Rank #2 (read: 8 ETFs Up More Than 25% YTD).
iShares U.S. Healthcare Providers ETF (IHF - Free Report) – Up 533%
This ETF follows the Dow Jones U.S. Select Healthcare Providers Index with exposure to 46 companies that provide health insurance, diagnostics and specialized treatment. It has amassed $861.5 million in its asset base, while volume is lower at about 51,000 shares per day on average. It charges 43 bps in annual fees and has a Zacks ETF Rank #2.
iShares North American Tech-Software ETF (IGV - Free Report) – Up 531%
This ETF provides exposure to the software segment of the broader U.S. technology space by tracking the S&P North American Technology-Software Index. Holding a basket of 64 securities, the fund charges 47 bps in annual fees and has AUM of $2 billion. Volume is good as it exchanges nearly 287,000 shares a day. IGV has a Zacks ETF Rank #2 (read: 5 Hot Tech ETFs & Stocks Leading the Market Rally).
This ETF provides exposure to 103 largest domestic and international non-financial companies listed on the Nasdaq by tracking the Nasdaq 100 Index. QQQ is one of the largest and most popular ETFs in the large-cap space with AUM of $70.4 billion and average daily volume of around 39.1 million shares. It charges investors 20 bps in annual fees. The fund has a Zacks ETF Rank #1.
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Market-Beating, Top-Ranked ETFs of the Longest Bull Market
The U.S. bull market is now the longest ever, stretching 3,453 days or nine and-a-half years, surpassing the 3,452-day record set during Sep 11, 1990 to Mar 24, 2000. This means that the index never slipped to the bear territory (decline of 20%) though it witnessed correction many times (a decline of 10%) triggered by the downgrade of America's credit rating in 2011, the collapse of the euro, Greece turmoil, Japan’s recession, China's alarming economic slowdown, the oil price carnage, recent tech sell-off, inflation threats and the U.S.-China trade turmoil.
Given these hurdles, this longest bull market has been unable to become the most powerful one with gains of 324% for the S&P 500, just behind the 417% rally seen during the 1990-2000 run. Notably, the index has created about $18 trillion in wealth since it bottomed on Mar 9, 2009. The solid run has been mainly driven by the technology surge and an unprecedented era of cheap money from low interest rates. As such, the tech-heavy Nasdaq Composite Index is the biggest winner of this bull market, jumping 611%. The Dow Jones Industrial Average has gained about 300% from around a low of 6,500 to nearly 26,000 (read: S&P 500 on Track for Longest Bull Run: How to Trade With ETFs).
The bull run will likely continue for more months as the U.S. economy is witnessing the fastest pace of growth in nearly four years, with a nearly two-decade low unemployment rate of 3.9%, historic tax cuts, higher government spending, deregulation, rising consumer confidence and higher spending. Per Trump, “the United States is on track to hit the highest annual growth rate in over 13 years.”
Further, corporate profits are surging and Q2 double-digit earnings growth is expected to be the highest quarterly growth pace in almost eight years. For full-year 2018, total earnings for the S&P 500 index are expected to be up 20.6% on 6.3% higher revenues.
While there have been winners in many corners of the space, several ETFs have easily crushed the S&P 500 by wide margins. Below, we have presented a bunch of top performing ETFs of the longest bull market that will continue to outperform in the coming months given that these have a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy).
First Trust Dow Jones Internet Index Fund (FDN - Free Report) – Up 873%
This fund targets the Internet corner of the broad technology space with AUM of $9.3 billion and average daily volume of around 649,000 shares. The fund follows the Dow Jones Internet Composite Index and holds 41 stocks in its basket. Expense ratio comes in at 0.53%. The fund has a Zacks ETF Rank #1 (read: Social Media Dives: Time to Buy the Dip With ETFs?).
Invesco NASDAQ Internet ETF (PNQI - Free Report) – Up 867%
This fund offers exposure to the largest and most liquid U.S.-listed companies engaged in Internet-related businesses by tracking the Nasdaq Internet Index. It holds about 95 stocks and charges 60 bps in annual fees. The ETF has AUM of $658.1 million and trades in a lower volume of around 44,000 shares a day. The product has a Zacks ETF Rank #1.
First Trust NYSE Arca Biotechnology Index Fund (FBT - Free Report) – Up 715%
The fund follows the NYSE Arca Biotechnology Index, which measures the performance of a cross section of companies in the biotechnology industry that are primarily involved in the use of biological processes to develop products or provide services. With AUM of $2.2 billion, it holds 30 stocks in its basket, charging 0.56% in annual fees. The fund trades in a moderate average daily volume of 87,000 shares and carries a Zacks ETF Rank #2 (read: What Investors Need to Know about Biotech ETFs).
iShares U.S. Aerospace & Defense ETF (ITA - Free Report) – Up 562%
This fund offers exposure to 38 U.S. companies that manufacture commercial and military aircraft and other defense equipment. It follows the Dow Jones U.S. Select Aerospace & Defense Index and charges 43 bps in fees per year. The fund has accumulated $5.8 billion in AUM and trades in good volume of around 296,000 shares. It has a Zacks ETF Rank #2 (read: 4 Sector ETFs to Tap at New Highs).
First Trust NASDAQ-100-Technology Sector Index Fund (QTEC - Free Report) – Up 549%
This ETF offers broad exposure to the technology sector by tracking the NASDAQ-100 Technology Sector Index. It holds 37 stocks in its basket with AUM of $2.6 billion and average daily volume of around 180,000 shares. It charges 58 bps in annual fees and has a Zacks ETF Rank #1.
Invesco Dynamic Software ETF – Up 541%
This ETF provides exposure to 30 software segment of the broader U.S. technology space and holds a small basket of 30 stocks. It charges 63 bps in annual fees and has AUM of $251.1 million. The product sees lower average daily volume of 22,000 shares and has a Zacks ETF Rank #2 (read: 8 ETFs Up More Than 25% YTD).
iShares U.S. Healthcare Providers ETF (IHF - Free Report) – Up 533%
This ETF follows the Dow Jones U.S. Select Healthcare Providers Index with exposure to 46 companies that provide health insurance, diagnostics and specialized treatment. It has amassed $861.5 million in its asset base, while volume is lower at about 51,000 shares per day on average. It charges 43 bps in annual fees and has a Zacks ETF Rank #2.
iShares North American Tech-Software ETF (IGV - Free Report) – Up 531%
This ETF provides exposure to the software segment of the broader U.S. technology space by tracking the S&P North American Technology-Software Index. Holding a basket of 64 securities, the fund charges 47 bps in annual fees and has AUM of $2 billion. Volume is good as it exchanges nearly 287,000 shares a day. IGV has a Zacks ETF Rank #2 (read: 5 Hot Tech ETFs & Stocks Leading the Market Rally).
Invesco QQQ (QQQ - Free Report) – Up 526%
This ETF provides exposure to 103 largest domestic and international non-financial companies listed on the Nasdaq by tracking the Nasdaq 100 Index. QQQ is one of the largest and most popular ETFs in the large-cap space with AUM of $70.4 billion and average daily volume of around 39.1 million shares. It charges investors 20 bps in annual fees. The fund has a Zacks ETF Rank #1.
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 >>