Retail ETFs have been gaining momentum to start the New Year. Most retail ETFs are in the green in the past one-week frame. And why not? Despite high inflation, holiday shopping season 2022 came in at decent. But the increase in retail sales have been volume-driven, not price-driven.
Online sales during the holiday season increased 3.5% year over year to $211.7 billion, according to Adobe Analytics, as record-high discounts and promotions led shoppers to indulge on shopping, as quoted on CNBC. Online sales during Cyber Week, the five-day period from Thanksgiving to Cyber Monday, totaled about $35.3 billion.
But consumers remained economical this time. Sales of some big-ticket items, such as jewelry and consumer electronics, have declined. And retailers have marked down merchandise and cut back on orders to clear through surplus inventory and brace for a likely recession.
Toy discounts topped at 34% off listed price during the holiday season, up from 19% in the year-ago period. Electronics discounts peaked at 25%, up from 8% in the year-ago period. And apparel peaked at 19%, up from 13% a year ago, the CNBC article narrated.
E-commerce made up 21.6% of total retail sales over the holidays this year, according to Mastercard SpendingPulse. It’s a small increase over the holiday seasons in 2021 and 2020, when e-commerce contributed 20.9% and 20.6% of total sales, respectively, but a significant jump from the same period in 2019 when it made up 14.6% of sales.
Against this backdrop, investors can bet on the online retail ETFs as these are on high momentum. These ETFs trumped the S&P 500 in the New Year.
ETFs in Focus
Amplify Online Retail ETF (IBUY - Free Report) – Up 8.9% Past week
The underlying EQM Online Retail Index utilizes a rules-based methodology to select a globally diverse group of companies with 70% or more of revenue from online and virtual sales. 1 800 Flowers Com, Shutterstock, Etsy and Booking Holdings take the top four spots in the fund. No stock makes up more than 2.84% of the fund. The fund charges 65 bps in fees.
ProShares Online Retail ETF (ONLN - Free Report) – Up 9.2% Past week
The underlying ProShares Online Retail Index is a specialized retail index that tracks retailers that principally sell online or through other non-store channels. Amazon (24.6%), Alibaba (12.2%) and eBay (6.49%) are the top three holdings of the fund. The fund charges 58 bps in fees.
SPDR S&P Retail ETF (XRT - Free Report) – Up 4.8% Past Week
The underlying S&P Retail Select Industry Index represents the retail sub-industry portion of the S&P TMI. The S&P TMI tracks all the U.S. common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Small Cap exchanges. The Retail Index is a modified equal weight index. Sally Beauty, Bath & Body Works and Burlington Stores take the top three spots in the fund. No stock accounts for more than 1.51% of the fund. The fund charges 35 bps in fees.
First Trust S-Network E-Commerce ETF (ISHP - Free Report) – Up 4.1% Past Week
The underlying S-Network Global E-Commerce Index provides exposure to companies with securities listed on recognized global securities exchanges that are principally engaged in the global e-commerce industry, including the online retail, online marketplace, content navigation and e-commerce infrastructure business segments. JD Health International, KakaoBank and Pinduoduo take the top three spots on the fund. No stock accounts for more than 2.57% of the fund. The fund charges 60 bps in fees.
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Retail ETFs have been gaining momentum to start the New Year. Most retail ETFs are in the green in the past one-week frame. And why not? Despite high inflation, holiday shopping season 2022 came in at decent. But the increase in retail sales have been volume-driven, not price-driven.
Online sales during the holiday season increased 3.5% year over year to $211.7 billion, according to Adobe Analytics, as record-high discounts and promotions led shoppers to indulge on shopping, as quoted on CNBC. Online sales during Cyber Week, the five-day period from Thanksgiving to Cyber Monday, totaled about $35.3 billion.
But consumers remained economical this time. Sales of some big-ticket items, such as jewelry and consumer electronics, have declined. And retailers have marked down merchandise and cut back on orders to clear through surplus inventory and brace for a likely recession.
Toy discounts topped at 34% off listed price during the holiday season, up from 19% in the year-ago period. Electronics discounts peaked at 25%, up from 8% in the year-ago period. And apparel peaked at 19%, up from 13% a year ago, the CNBC article narrated.
E-commerce made up 21.6% of total retail sales over the holidays this year, according to Mastercard SpendingPulse. It’s a small increase over the holiday seasons in 2021 and 2020, when e-commerce contributed 20.9% and 20.6% of total sales, respectively, but a significant jump from the same period in 2019 when it made up 14.6% of sales.
Against this backdrop, investors can bet on the online retail ETFs as these are on high momentum. These ETFs trumped the S&P 500 in the New Year.
ETFs in Focus
Amplify Online Retail ETF (IBUY - Free Report) – Up 8.9% Past week
The underlying EQM Online Retail Index utilizes a rules-based methodology to select a globally diverse group of companies with 70% or more of revenue from online and virtual sales. 1 800 Flowers Com, Shutterstock, Etsy and Booking Holdings take the top four spots in the fund. No stock makes up more than 2.84% of the fund. The fund charges 65 bps in fees.
ProShares Online Retail ETF (ONLN - Free Report) – Up 9.2% Past week
The underlying ProShares Online Retail Index is a specialized retail index that tracks retailers that principally sell online or through other non-store channels. Amazon (24.6%), Alibaba (12.2%) and eBay (6.49%) are the top three holdings of the fund. The fund charges 58 bps in fees.
SPDR S&P Retail ETF (XRT - Free Report) – Up 4.8% Past Week
The underlying S&P Retail Select Industry Index represents the retail sub-industry portion of the S&P TMI. The S&P TMI tracks all the U.S. common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Small Cap exchanges. The Retail Index is a modified equal weight index. Sally Beauty, Bath & Body Works and Burlington Stores take the top three spots in the fund. No stock accounts for more than 1.51% of the fund. The fund charges 35 bps in fees.
First Trust S-Network E-Commerce ETF (ISHP - Free Report) – Up 4.1% Past Week
The underlying S-Network Global E-Commerce Index provides exposure to companies with securities listed on recognized global securities exchanges that are principally engaged in the global e-commerce industry, including the online retail, online marketplace, content navigation and e-commerce infrastructure business segments. JD Health International, KakaoBank and Pinduoduo take the top three spots on the fund. No stock accounts for more than 2.57% of the fund. The fund charges 60 bps in fees.
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