The mood in Wall Street grew tense on the first trading day of December. The Centers for Disease Control and Prevention’s confirmation that the first case of omicron has been detected in the United States in California led to the new wave of worries. Consequently, all three major indices ended the first day of the final month of 2021 in red.
The rising cases due to the new variant have frightened investors. They fear that implementing new lockdown measures to control the spread may hurt the global economic recovery achieved so far, following the reopening of economies. At least 70 countries and territories are believed to have put travel restrictions from several African countries to control the outbreak, per a CNN report.
Investors willing to sail through the current market turbulences from the latest COVID-variant-related concerns and bet on opportunities to earn good returns can consider
First Trust Cloud Computing ETF ( SKYY Quick Quote SKYY - Free Report) , Global X E-commerce ETF ( EBIZ Quick Quote EBIZ - Free Report) , ProShares Online Retail ETF ( ONLN Quick Quote ONLN - Free Report) , VanEck Video Gaming and eSports ETF ( ESPO Quick Quote ESPO - Free Report) and Global X Video Games & Esports ETF ( HERO Quick Quote HERO - Free Report) .
Amid the coronavirus pandemic, surging work-from-home and online shopping trends, increasing digital payments, growing video streaming and soaring video game popularity have been observed.
Evidently, industries like cloud computing have been thriving, with the majority of people working from home. Even though vaccine rollout has begun globally, demand for cloud computing is set to stay robust even beyond the pandemic. In the wake of the pandemic, cloud technology adoption is projected to witness robust growth in sectors where the work-from-home initiatives are helping sustain business functions.
The pandemic has been a blessing in disguise for the e-commerce industry to date as people continue to practice social distancing and shopping online for all essentials, especially food items. Thus, on par with the digitization trend, the upcoming U.S. holiday season is expected to see a significant surge in online sales. The National Retail Federation projects online and other non-store sales increase of 11% to 15% to reach between $218.3 billion and $226 billion compared with $196.7 billion in 2020.
Video gaming lovers in the United States have spent generously in October again. The industry continues to gain amid the health crisis. For 10 months, the total consumer spending on gaming is up 12% year over year to $46.67 billion (per The NPD Group data). Market experts are optimistic about the video gaming industry's strength in terms of solid sales growth despite tough year-over-year comparisons, highlighting the momentum in the space.
Going on, it seems that the boom in the video gaming space may remain even in the post-pandemic era as the outbreak changed the lifestyles and preferences of U.S. citizens to a large extent.
ETFs to Watch Out For
Against this backdrop, we present some ETFs from several corners of the e-commerce segment, technology or consumer discretionary sector that will continue gaining from the “new normal” trends:
First Trust Cloud Computing ETF
First Trust Cloud Computing ETF seeks investment results that generally correspond to the price and yield, before fees and expenses, of the ISE CTA Cloud Computing Index. SKYY tracks the performance of companies actively involved in the cloud computing industry. First Trust Cloud Computing ETF holds about 66 securities in its basket. First Trust Cloud Computing ETF has AUM of $6.37 billion and an expense ratio of 0.60% (read:
2 ETF Areas With Further Run-Up Potential on Tech Earnings Cues). Amplify Online Retail ETF
Amplify Online Retail ETF attracted $764.5 million to its asset base and offers global exposure to companies that derive 70% or more revenues from online and virtual retail by tracking the EQM Online Retail Index.
Amplify Online Retail ETF is home to 79 stocks, each accounting for less than 2.61% of its assets. IBUY charges 65 basis points (bps) in annual fees (read:
Retail ETFs Decline as Thanksgiving Weekend Sales Drop). ProShares Online Retail ETF
ProShares Online Retail ETF focuses on global retailers that derive significant revenues from online sales. ONLN tracks the ProShares Online Retail Index.
ProShares Online Retail ETF has accumulated $738.1 million in its asset base and charges 58 bps in annual fees (read:
Grab Retail ETFs on Upbeat Holiday Sales Forecast). VanEck Video Gaming and eSports ETF
VanEck Video Gaming and eSports ETF aims to replicate as closely as possible, before fees and expenses, the price and yield performance of the MVIS Global Video Gaming and eSports Index, which is intended to track the overall performance of companies involved in video game development, esports and the related hardware and software.
ESPO holds 26 stocks in its basket. With AUM of $675.6 million, VanEck Video Gaming and eSports ETF charges 55 bps as expense ratio (read:
5 Best Sector ETFs of November). Global X Video Games & Esports ETF
Global X Video Games & Esports ETF looks to invest in companies that develop or publish video games, facilitate the streaming and distribution of video gaming or esports content, own and operate within competitive esports leagues or produce hardware used in video games and esports, including augmented and virtual reality.
HERO holds 40 stocks in its basket. With AUM of $492.1 million, Global X Video Games & Esports ETF charges 50 bps as expense ratio (read:
Bet on These Video Gaming ETFs to Ride the Surging Sales Trend).