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The stupendous global growth in e-commerce has been turning ETF issuers’ focus toward this segment. People are spending more on online shopping. E-commerce usage increased 16% in 2017 against 14% growth noticed in the prior year. This marked 13% of total retail sales in 2017, a noticeable increase from 11.6% in 2016.
Probably this is why, Global X has filed for an E-Commerce ETF namely Global X E-commerce ETF EBIZ.
Inside EBIZ
To enter the Underlying Index, companies must have a minimum market capitalization of $200 million and average daily turnover in last six months greater than or equal to $2 million, per the prospectus. It is an all-cap index. As of Oct 1, 2018, the Underlying Index consisted of 35 stocks. The fund charges 68 bps in fees (read: Guide to E-commerce ETFs).
As of Oct 1, 2018, companies listed in the following countries were fit to make it to the Underlying Index: Australia, Austria, Belgium, Brazil, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Poland, Portugal, Singapore, Spain, Sweden, Switzerland, South Korea, Taiwan, the United Kingdom, and the United States, according to the prospectus
How Does It Fit in a Portfolio?
Internet and e-commerce boast solid growth potential. Per Statista, e-commerce share of global retail sales will likely go up to 17.5% in 2021 from 10.2% in 2017. Last year, global retail ecommerce sales were $2.304 trillion, marking a 24.8% year-over-year increase, per eMarketer. Mobile was the main driving factor and by 2021, m-commerce is likely to account for about 72.9% of the ecommerce market.
E-commerce usage increased 16% in 2017 from 14% the prior year, accounting for 13% of total retail sales. As much as 49% of shoppers start their searches on Amazon.com, per Kleiner Perkins Caufield & Byers’ Mary Meeker.
In particular, eMarketer estimates that U.S. ecommerce sales will grow 15.6% in 2018 to reach $526.09 billion, 14.8% in 2019, 14.3% in 2020, 13.9% in 2021 and 13.3% in 2022. While 10% of total retail sales are likely to be done online in 2018, the number is expected to rise to 11.1% in 2019, 12.4% in 2020, 13.7% in 2021 and 13.3% in 2022.
Another firm, Forrester, expects U.S. online sales to cross $506 billion this year and rise beyond $712 billion by 2022. More than half — 53% — of the $3.7 trillion U.S. retail market will be accessed digitally by the end of 2018. More than $1.3 trillion of U.S. retail sales will likely be driven by smartphones in 2018, per the source (see: all the Consumer Discretionary ETFs here).
Will the Proposed Fund See Success?
There are a few products in the space. These include Amplify Online Retail ETF (IBUY - Free Report) , ProShares Online Retail ETF (ONLN - Free Report) and ProShares Long Online/Short Stores ETF (CLIX - Free Report) . Among these, IBUY and CLIX charge 65 bps while ONLN charges 58 bps, meaning the trio charges lesser than the proposed fund EBIZ.
In fact, the article went on to notify that EBIZ will deploy artificial intelligence techniques to build its stock portfolio. So overall, we can conclude that EBIZ should be able to gather investors’ assets over the long run despite the issuer’s late entry in the space because the product is packaged in a slightly different manner.
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Global X Plans New E-Commerce ETF Rollout
The stupendous global growth in e-commerce has been turning ETF issuers’ focus toward this segment. People are spending more on online shopping. E-commerce usage increased 16% in 2017 against 14% growth noticed in the prior year. This marked 13% of total retail sales in 2017, a noticeable increase from 11.6% in 2016.
Probably this is why, Global X has filed for an E-Commerce ETF namely Global X E-commerce ETF EBIZ.
Inside EBIZ
To enter the Underlying Index, companies must have a minimum market capitalization of $200 million and average daily turnover in last six months greater than or equal to $2 million, per the prospectus. It is an all-cap index. As of Oct 1, 2018, the Underlying Index consisted of 35 stocks. The fund charges 68 bps in fees (read: Guide to E-commerce ETFs).
As of Oct 1, 2018, companies listed in the following countries were fit to make it to the Underlying Index: Australia, Austria, Belgium, Brazil, Canada, Denmark, Finland, France, Germany, Hong Kong, Ireland, Israel, Italy, Japan, Netherlands, New Zealand, Norway, Poland, Portugal, Singapore, Spain, Sweden, Switzerland, South Korea, Taiwan, the United Kingdom, and the United States, according to the prospectus
How Does It Fit in a Portfolio?
Internet and e-commerce boast solid growth potential. Per Statista, e-commerce share of global retail sales will likely go up to 17.5% in 2021 from 10.2% in 2017. Last year, global retail ecommerce sales were $2.304 trillion, marking a 24.8% year-over-year increase, per eMarketer. Mobile was the main driving factor and by 2021, m-commerce is likely to account for about 72.9% of the ecommerce market.
E-commerce usage increased 16% in 2017 from 14% the prior year, accounting for 13% of total retail sales. As much as 49% of shoppers start their searches on Amazon.com, per Kleiner Perkins Caufield & Byers’ Mary Meeker.
In particular, eMarketer estimates that U.S. ecommerce sales will grow 15.6% in 2018 to reach $526.09 billion, 14.8% in 2019, 14.3% in 2020, 13.9% in 2021 and 13.3% in 2022. While 10% of total retail sales are likely to be done online in 2018, the number is expected to rise to 11.1% in 2019, 12.4% in 2020, 13.7% in 2021 and 13.3% in 2022.
Another firm, Forrester, expects U.S. online sales to cross $506 billion this year and rise beyond $712 billion by 2022. More than half — 53% — of the $3.7 trillion U.S. retail market will be accessed digitally by the end of 2018. More than $1.3 trillion of U.S. retail sales will likely be driven by smartphones in 2018, per the source (see: all the Consumer Discretionary ETFs here).
Will the Proposed Fund See Success?
There are a few products in the space. These include Amplify Online Retail ETF (IBUY - Free Report) , ProShares Online Retail ETF (ONLN - Free Report) and ProShares Long Online/Short Stores ETF (CLIX - Free Report) . Among these, IBUY and CLIX charge 65 bps while ONLN charges 58 bps, meaning the trio charges lesser than the proposed fund EBIZ.
But then, investment objective is also slightly different for EBIZ and IBUY. While the latter “only tracks online retailers, Global X's proposed fund would also track the companies creating and operating the underlying technology, including e-commerce platform operators, and service and software providers,” per an article published on etf.com.
In fact, the article went on to notify that EBIZ will deploy artificial intelligence techniques to build its stock portfolio. So overall, we can conclude that EBIZ should be able to gather investors’ assets over the long run despite the issuer’s late entry in the space because the product is packaged in a slightly different manner.
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 >>