It was a tough year for the U.S. markets as most of the major benchmarks are struggling to register healthy gains this year. Several concerns including sluggish global growth, a dramatic slide in oil prices and a stronger dollar continued to hurt the performances of the benchmarks throughout the year. Though many of the ETFs followed the overall trend of the market movement, some of them took recourse to an alternative path.
Major Lingering Concerns
The continuing plunge in oil prices is one of the major concerns this year. The absence of a justifiable motive to reduce oil production from the Organization of the Petroleum Exporting Countries (OPEC) and non-OPEC countries, including Russia, and weak global demand continued to weigh on oil prices. Moreover, the fact that Iran will start exporting oil next year when international sanctions are lifted and a lower-than-expected fall in the U.S. production raised further concerns (read: 5 ETFs to Profit from the Oil Collapse).
Separately, global growth worries including that in the world’s second largest economy dampened investor sentiment throughout the year. A flurry of dismal Chinese economic data released over the period increased concerns that the economy mail fail to reach its 7% target this year. Though GDP growth in the third quarter for the U.S. was revised upward in the latest estimate released by the Commerce Department, the overall economic picture remained disappointing (read: 3 Small-Cap Growth ETFs to Beat Global Worries).
Another main concern that had a negative impact on markets is the strengthening dollar. A stronger dollar dragged down the earnings performance of the major companies with significant international exposure. Also, strong labor market conditions and a slow upward movement of inflation rate raised the prospect of a lift-off this month, which further had a negative impact on investor sentiment (read: Before the Fed Rate Hike, Buy These Stocks and ETFs).
5 ETFs Bucking the Trend
Despite these concerns, some of the ETFs performed impressively to register solid returns and gained investor attention this year. In this section, we have highlighted 5 ETFs that returned at least 20% in the year-to-date frame and are poised to end the year on a positive note.
Market Vectors ChinaAMC SME-ChiNext ETF (CNXT - Free Report)
This fund provides exposure across 101 securities by tracking the SME-ChiNext 100 Index. Nearly 25.5% of total assets are allocated to the top 10 holdings. Sector-wise, Information Technology takes the top spot at 32.8%, while Industrials and Consumer Discretionary take next two positions. CNXT has amassed $56.5 million in its asset base while it sees moderate volume of around 125,000 shares a day. The ETF has 0.66% in expense ratio and has a Zacks Rank #3 (Hold). The ETF returned 42% in the year-to-date frame.
WisdomTree Japan Hedged Health Care ETF (DXJH - Free Report)
This fund follows the WisdomTree Japan Hedged Health Care Index, holding 57 stocks in its portfolio. The product is largely concentrated in the top 10 firms that collectively make 61.6% of the basket. The ETF has been able to manage $22.9 million in its asset base and is lightly traded with more than 14,000 shares per day. It charges 48 bps in annual fees and expenses. The ETF has a Zacks Rank #1 (Strong Buy) and returned 37.8% in the year-to-date frame.
ALPS Medical Breakthroughs ETF (SBIO - Free Report)
This fund provides exposure across 81 securities by tracking the Poliwogg Medical Breakthroughs Index. Nearly 39.2% of total assets are allocated to the top 10 holdings. Sector-wise, Biotechnology takes the top spot at 74% with the rest of the assets invested in Pharmaceuticals. SBIO has amassed $169.5 million in its asset base while it sees moderate volume of around 149,000 shares a day. The ETF has 0.50% in expense ratio and has a Zacks Rank #2 (Buy). The ETF returned 26.7% in the year-to-date frame.
First Trust Dow Jones Internet ETF (FDN - Free Report)
This fund follows the Dow Jones Internet Composite Index, holding 41 stocks in its portfolio. The product is largely concentrated in the top 10 firms that collectively make 61% of the basket. The ETF has been able to manage $4.9 billion in its asset base and is moderately traded with more than 598,000 shares per day. It charges 54 bps in annual fees and expenses. The ETF has a Zacks Rank #2 (Buy) and returned 24.8% in the year-to-date frame (read: Zuckerberg Philanthropic Zeal Brings These ETFs in Focus).
PowerShares NASDAQ Internet ETF (PNQI - Free Report)
This fund provides exposure across 94 securities by tracking the NASDAQ Internet Index. Nearly 61% of total assets are allocated to the top 10 holdings. Sector-wise, Internet Software & Services takes the top spot at 56%, while Internet & Catalog Retail takes the next position. PNQI has amassed $260.8 million in its asset base while it sees light volume of around 24,000 shares a day. The ETF has 0.60% in expense ratio and has a Zacks Rank #2 (Buy). The ETF returned 22.7% in the year-to-date frame.