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5 ETFs to Benefit From a Likely Record Cyber Week Sales

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Just as shoppers are readying to grab the Black Friday deals, retailers have started preparing for Cyber Monday — the next big shopping event. In fact, Cyber Monday has grabbed maximum consumer attention in the recent past as "the preferred day for deals."

The National Retail Federation said about 2 million more people than last year are expected to fill their shopping cart from Thanksgiving Day through Cyber Monday this year. Cyber Week (Thanksgiving through Cyber Monday) is expected to drive $36 billion in online spending — 17% of the entire holiday season, per Adobe.

Adobe projects that Cyber Monday will remain the biggest day of the year at $11.3 billion in sales (up 4% year over year), with Black Friday sales likely to come in at $9.5 billion (up 5% year over year) and Thanksgiving sales of around $5.4 billion (up 6% year over year).

This puts the spotlight on ProShares Online Retail ETF (ONLN - Free Report) , Wedbush ETFMG Video Game Tech ETF (GAMR - Free Report) , AdvisorShares Restaurant ETF (EATZ - Free Report) , SPDR S&P Retail ETF (XRT - Free Report) and Technology Select Sector SPDR Fund (XLK - Free Report) .

We Are Likely to See Record Cyber Week Sales

According to Deloitte’s 2021 Holiday Retail Survey, 34% of respondents plan to shop on Cyber Monday this year, up 29% year over year, as quoted on street.com. A record $10.8 billion was shelled out online by the end of Cyber Monday 2020. Some industry experts expect new records this year with Salesforce forecasting online holiday sales reaching a record $1.2 trillion globally.

Adobe released its forecast for global e-commerce sales of a record year at $910 billion with the United States making up about 23% of the total. Adobe also expects U.S. holiday sales online to hit $207 billion from Nov 1 to Dec 31, creating a new record.

Buy Now Pay Later (BNPL) is an emerging and key consumer trend, which is fueling retail sales. Adobe expects over $4 trillion to be spent globally in all of 2021 — marking a key achievement for e-commerce.

NRF survey revealed that clothing is the first choice of consumers and is expected to be given by 53% of shoppers, followed by gift cards at 46%, toys at 39%, books/music/movies/video games at 35% and food/candy at 31%.

Spending on gift cards spending is expected to total $28.1 billion, the highest tally since $29.9 billion in 2018. Shoppers plan to buy an average three or four cards this year with an average $48.92 per card, including restaurant cards (pointed out by 32%), department store cards (26%), bank-issued gift cards (26%) and coffee shop cards (20%), per NRF.

Against this backdrop, below we highlight a few ETFs that are great bets in the current scenario.

ETFs in Focus

ProShares Online Retail ETF

The udunderlying ProShares Online Retail Index is a specialized retail index that tracks retailers that principally sell online or through other non-store channels. Amazon.com takes about 26.1% of ONLN.

Wedbush ETFMG Video Game Tech ETF

Video games are among the top toys’ category for holiday 2021. The underlying EEFund Video Game Tech Index of GAMR tracks companies actively involved in the electronic gaming industry, including the entertainment, education and simulation segments.

AdvisorShares Restaurant ETF

The AdvisorShares Restaurant ETF is an actively managed exchange-traded fund that seeks to achieve its investment objective by investing at least 80% of its net assets in securities of companies that derive at least 50% of their net revenues from the restaurant business.

SPDR S&P Retail ETF

SPDR S&P Retail ETF invests about 20% in apparel retail. 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.

Technology Select Sector SPDR Fund

Apple takes about 22% of Technology Select Sector SPDR Fund. Apple’s products are always hot in the holiday season. Microsoft also takes 22.3% of XLK. Microsoft’s Xbox is another hot pick this cyber week. The underlying Technology Select Sector Index includes companies from the following industries: computers & peripherals; software; diversified telecommunication services; communications equipment; semiconductor & semiconductor equipment; internet software & services; IT services; wireless telecommunication services; electronic equipment & instruments; and office electronics.