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5 Winning Global ETFs of First Nine Months of 2021

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Global markets have rallied this year on return of the risk-on sentiments. Ultra-easy monetary and fiscal policies have led to the uptick. The rapid vaccination globally and the talks of booster shots from Pfizer (PFE - Free Report) -BioNTech have added to the global market advantage. The S&P 500 is up about 18.6% this year while iShares MSCI ACWI ETF (ACWI - Free Report) has added about 13.5% this year. 

The slide in the Chinese market due to the regulators’ crackdown on various sectors have cut some strength of the global markets. Most recently, China’s property market behemoth Evergrande Group has hit headlines for default risks.

Meanwhile, oil prices surged in the global market. United States Brent Oil Fund, LP (BNO - Free Report) has added 58% on supply disruptions and rising pent-up demand. Gradual economic reopening has opened up doors for several developed market banks to mull over the policy tightening.   

The Norges Bank on Sep 23 become the first developed central bank to raise interest rates following the emergence of the coronavirus pandemic. After cutting rates three times in 2020 due the pandemic-driven crisis, Norway’s central bank unanimously decided to hike rates to 0.25% from zero. This shows policymakers’ conviction in the country’s economic growth.

Federal Reserve Chair Jerome Powell has said lately that the central bank could start scaling back asset purchases as soon as November and finish the process by mid-2022. Several officials are even interested to hike interest rates next year.

The European Central Bank (ECB) will also said that it will slow down emergency bond purchases over the coming quarter. This would be a step forward for the ECB toward unwinding the emergency aid that has shored up the Euro zone economy during the coronavirus pandemic.

Central banks' such comments and moves have increased interest rates lately. Against this backdrop, below we highlight a few global ETFs that have gained the maximum this year.

ETFs in Focus

Barclays Return on Disability ETN – Up 26.1%

The Return on Disability US LargeCap ETN Total Return USD Index represents the top 100 large public companies in the United States. This equity index recognizes companies that are outperforming in the disability market. The fund charges 45 bps in fees.

Pacer Cash Cows Fund of Funds ETF (HERD - Free Report) – Up 24.6%

The underlying Pacer Cash Cows Fund of Funds Index uses an objective, rules-based approach to construct a portfolio that is composed of the ETFs that seeks to provide exposure to companies with high free cash flow yields. The fund charges 73 bps in fees.

Invesco Global Listed Private Equity ETF (PSP - Free Report) – Up 23.4%

The underlying Red Rocks Global Listed Private Equity Index includes securities, ADRs and GDRs of 40 to 75 private equity companies, including BDCs, MLPs and other vehicles whose principal business is to invest in, lend capital to or provide services to privately held companies. The expense ratio of the fund is 1.58%.

iPath Shiller CAPE ETN (CAPE - Free Report) – Up 21.6%

The underlying Shiller Barclays CAPE US Core Sector Index aims to provide a notional long exposure to the top four relatively undervalued US equity sectors that also exhibit relatively strong price momentum. The fund charges 45 bps in fees.

LeaderShares Activist Leaders ETF (ACTV) – Up 21.3%

The actively-managed fund employs an investment approach that focuses on equity securities that are the target of shareholder activism. These equity securities are identified using a proprietary quantitative methodology built on the foundation of tracking legally mandated filings known as "13D" filings that are submitted with the Securities and Exchange Commission (“SEC”). Rules adopted under the Securities Exchange Act of 1934 require a shareholder that acquires, with an activist intent, more than 5% of a company's shares to file a form with the SEC known as a Schedule 13D that discloses the investor's identity and the investor’s purpose in acquiring those shares.

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