The year 2020 has been beneficial for equities with
SPDR S&P 500 ETF ( SPY Quick Quote SPY - Free Report) gaining about 15.2% (as of Dec 18, 2020), SPDR Dow Jones Industrial Average ETF ( DIA Quick Quote DIA - Free Report) adding about 5.9%, Invesco QQQ Trust (gaining about 46.3% and QQQ Quick Quote QQQ - Free Report) iShares Russell 2000 ETF ( IWM Quick Quote IWM - Free Report) advancing about 17.9%.
Resurfacing global growth worries due to COVID-19 outbreak, constant volatility in the oil patch and a flattening yield curve in the United States have invoked fears about prolonged global recession.
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,
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. Below we highlight some actively-managed ETFs that have surged massively this year.
ARK Genomic Revolution ETF ( ARKG Quick Quote ARKG - Free Report) – Up 178.4%
Companies within ARKG are focused on and are expected to benefit from extending and enhancing the quality of human and other life by incorporating technological and scientific developments and advancements in genomics into their business.The fund charges 76 bps in fees.
ARK Next Generation Internet ETF ( ARKW Quick Quote ARKW - Free Report) – Up 152.8%
Companies within the ARK Next Generation Internet ETF are focused on and expected to benefit from shifting the bases of technology infrastructure to the cloud, enabling mobile, new and local services. The fund charges 76 bps in fees.
ARK Innovation ETF ( ARKK Quick Quote ARKK - Free Report) – Up 147.7%
Companies within ARKK include those that rely on or benefit from the development of new products or services, technological improvements and advancements in scientific research relating to the areas of DNA technologies, industrial innovation in energy, automation and manufacturing, the increased use of shared technology, infrastructure and services, and technologies that make financial services more efficient.
Franklin Disruptive Commerce ETF ( BUYZ Quick Quote BUYZ - Free Report) – Up 109.3%
Provides access to companies that are related to new online markets and path-breaking ways to deliver goods and services. It uses bottom-up fundamental research. It charges 50 bps in fees.
ARK Fintech Innovation ETF ( ARKF Quick Quote ARKF - Free Report) – Up 105.9%
The fund looks to achieve this investment objective by investing under normal circumstances primarily in domestic and foreign equity securities of companies that are engaged in the fund’s investment theme of financial technology innovation.
SoFi Gig Economy ETF ( GIGE Quick Quote GIGE - Free Report) – Up 96.3%
The fund is composed of companies that have changed the way people access goods, services, and work. The fund charges 59 bps in fees.
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