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The year 2018 has been rocky for equities withSPDR S&P 500 ETF (SPY - Free Report) losing 3.1% (as of Dec 14, 2018), SPDR Dow Jones Industrial Average ETF (DIA - Free Report) shedding about 2.7% and Invesco QQQ Trust (QQQ - Free Report) gaining only 1.6%.
Resurfacing global growth worries, nagging trade tensions between the United States and China, constant volatility in the oil patch and a flattening yield curve in the United States have invoked recessionary fears.
Against this background, investors and fund managers had to be prudent with the changing dynamics of the market. And in order to do so, several investors resorted to active ETFs. An actively managed ETF does have a benchmark index, but managers may alter sector allocations, market-time trades or shift from the index constituents if they consider appropriate, per investopedia.
Investors should note that active funds are arguably expensive as these involve research expenses associated with the manager’s due diligence and additional cost in the form of a wide bid/ask spread beyond the expense ratio.
Still, there has been a surge of actively managed ETFs lately. Actively-managed ETFs have been outperforming the passive ones as the average year-to-date returns for the passively-managed funds are negative 6.5% this year while the figure for the actively-managed ones is negative 3.74%.
Below we highlight some top-performing active ETFs of 2018 that breezed past the S&P 500 (as of Dec 14, 2018) (read: Will Active ETFs Rule Ahead?).
AdvisorShares Dorsey Wright Short ETF (DWSH - Free Report) – Up 18.7%
The fund is actively managed with an investment focus that involves buying securities that have appreciated in price more than the other securities in the investment universe, and holding those securities until they underperform (read: October Traditionally Most Volatile: ETFs That Gained).
iShares Evolved US Healthcare Staples ETF – Up 13.2%
The fund looks to offer access to U.S. companies with healthcare staples exposure. The expense ratio is pretty low at 18 bps a year. The fund is heavy on Unitedhealth Group (15.16%) followed by Abbott Laboratories (5.44%) and CVS Health Corp (4.58%).
The fund targets the utility sector and charges 95 bps in fees. Nextera Energy takes 15.57% of the fund, while DTE Energy takes 8.39% of the portfolio.
The fund provides thematic exposure to all sectors of innovation. The securities in ARKK offer the best risk-reward opportunities from ARK’s innovation-based themes, while providing less volatility. The fund charges 75 bps in fees.
The fund seeks long-term growth of capital. It is an actively-managed ETF that invests primarily at least 80% of its assets in domestic equity securities and U.S. exchange traded foreign equity securities of companies that are relevant to the fund’s investment theme of Web x.0. It’s expense ratio of 0.75%.
WisdomTree Bloomberg US Dollar Bullish ETF (USDU - Free Report) – Up 7.1%
The fund looks to provide total returns that exceed the performance of the Bloomberg Dollar Spot Index. It charges 50 bps in fees (read: Is the Uptrend in Dollar ETFs Over?).
ClearBridge Large Cap Growth ESG ETF (LRGE - Free Report) – Up 4.3%
The fund seeks to achieve long-term capital appreciation through investments in large-capitalization companies with positive ESG attributes that have the potential for high future earnings growth (read: 5 ESG ETFs Outperforming the Broader Market).
Invesco Multi-Strategy Alternative ETF (LALT - Free Report) – Up 3.6%
The fund seeks to achieve positive total returns with low correlation to the broader securities’ markets by investing in a combination of equity securities, financial futures contracts, forward currency contracts and other securities. The expense ratio is 0.98% (read: 5 Long/Short ETFs to Play in Market Crash).
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8 Top Active ETFs of 2018
The year 2018 has been rocky for equities withSPDR S&P 500 ETF (SPY - Free Report) losing 3.1% (as of Dec 14, 2018), SPDR Dow Jones Industrial Average ETF (DIA - Free Report) shedding about 2.7% and Invesco QQQ Trust (QQQ - Free Report) gaining only 1.6%.
Resurfacing global growth worries, nagging trade tensions between the United States and China, constant volatility in the oil patch and a flattening yield curve in the United States have invoked recessionary fears.
Against this background, investors and fund managers had to be prudent with the changing dynamics of the market. And in order to do so, several investors resorted to active ETFs. An actively managed ETF does have a benchmark index, but managers may alter sector allocations, market-time trades or shift from the index constituents if they consider appropriate, per investopedia.
Investors should note that active funds are arguably expensive as these involve research expenses associated with the manager’s due diligence and additional cost in the form of a wide bid/ask spread beyond the expense ratio.
Still, there has been a surge of actively managed ETFs lately. Actively-managed ETFs have been outperforming the passive ones as the average year-to-date returns for the passively-managed funds are negative 6.5% this year while the figure for the actively-managed ones is negative 3.74%.
Below we highlight some top-performing active ETFs of 2018 that breezed past the S&P 500 (as of Dec 14, 2018) (read: Will Active ETFs Rule Ahead?).
AdvisorShares Dorsey Wright Short ETF (DWSH - Free Report) – Up 18.7%
The fund is actively managed with an investment focus that involves buying securities that have appreciated in price more than the other securities in the investment universe, and holding those securities until they underperform (read: October Traditionally Most Volatile: ETFs That Gained).
iShares Evolved US Healthcare Staples ETF – Up 13.2%
The fund looks to offer access to U.S. companies with healthcare staples exposure. The expense ratio is pretty low at 18 bps a year. The fund is heavy on Unitedhealth Group (15.16%) followed by Abbott Laboratories (5.44%) and CVS Health Corp (4.58%).
Reaves Utilities ETF (UTES - Free Report) – Up 11.7%
The fund targets the utility sector and charges 95 bps in fees. Nextera Energy takes 15.57% of the fund, while DTE Energy takes 8.39% of the portfolio.
ARK Innovation ETF (ARKK - Free Report) – Up 8.3%
The fund provides thematic exposure to all sectors of innovation. The securities in ARKK offer the best risk-reward opportunities from ARK’s innovation-based themes, while providing less volatility. The fund charges 75 bps in fees.
ARK Web x.0 ETF (ARKW - Free Report) – Up 8.0%
The fund seeks long-term growth of capital. It is an actively-managed ETF that invests primarily at least 80% of its assets in domestic equity securities and U.S. exchange traded foreign equity securities of companies that are relevant to the fund’s investment theme of Web x.0. It’s expense ratio of 0.75%.
WisdomTree Bloomberg US Dollar Bullish ETF (USDU - Free Report) – Up 7.1%
The fund looks to provide total returns that exceed the performance of the Bloomberg Dollar Spot Index. It charges 50 bps in fees (read: Is the Uptrend in Dollar ETFs Over?).
ClearBridge Large Cap Growth ESG ETF (LRGE - Free Report) – Up 4.3%
The fund seeks to achieve long-term capital appreciation through investments in large-capitalization companies with positive ESG attributes that have the potential for high future earnings growth (read: 5 ESG ETFs Outperforming the Broader Market).
Invesco Multi-Strategy Alternative ETF (LALT - Free Report) – Up 3.6%
The fund seeks to achieve positive total returns with low correlation to the broader securities’ markets by investing in a combination of equity securities, financial futures contracts, forward currency contracts and other securities. The expense ratio is 0.98% (read: 5 Long/Short ETFs to Play in Market Crash).
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 >>