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After a strong start to December, Wall Street is again struggling to find footing as bouts of solid economic data have dampened hopes for the Fed’s slower pace of rate hikes. The S&P 500 fell 3.4%, while the Dow lost 2.8% last week. The tech-heavy Nasdaq Composite Index declined 4%.
While most of the segments suffered losses last week, a few have performed really well. Breakwave Dry Bulk Shipping ETF (BDRY - Free Report) , Simplify Interest Rate Hedge ETF (PFIX - Free Report) , ProShares VIX Short-Term Futures ETF (VIXY - Free Report) , Simplify Tail Risk Strategy ETF (CYA - Free Report) and Advocate Rising Rate Hedge ETF (RRH - Free Report) ended the week in the green.
A stronger-than-expected November report on producer prices aggravated fears about the Federal Reserve’s interest rate hikes, following a stronger-than-expected November jobs report and a robust services sector report. The producer price index climbed 0.3% for the third month and was up 7.4% from a year ago.
The economy added 263,000 jobs in November, marking another strong month of jobs growth. The unemployment rate remained at 3.7%, close to a 50-year low, while average hourly earnings jumped 0.6% from the prior month and 5.1% from the year-ago month. Higher wages should add to inflation. Meanwhile, business activity jumped the most since March 2021 in November, suggesting that the largest part of the economy remains resilient. ISM’s gauge of services rose to 56.5 last month from 54.4 in October (read: 4 Sector ETFs to Play Upbeat November Jobs Data).
Further, consumer sentiment improved in early December, with the the University of Michigan's Consumer Confidence Index rising to 59.1 from 56.8 in November.
The Fed is expected to raise interest rates by a half-percentage point in a meeting this week.
Breakwave Dry Bulk Shipping ETF is the only freight futures ETF exclusively focused on the dry bulk shipping market through a portfolio of near-dated freight futures contracts on dry bulk indices. It holds freight futures with a weighted average of approximately three months to expiration, using a mix of one-to-six-month freight futures based on the prevailing calendar schedule.
Breakwave Dry Bulk Shipping ETF has accumulated about $38.8 million in AUM and trades in a good volume of about 249,000 shares per day on average. It charges a higher annual fee of 3.50%.
Simplify Interest Rate Hedge ETF seeks to provide a hedge against a sharp increase in long-term interest rates and benefit from market stress when fixed-income volatility increases, while providing the potential for income. It buys put options on longer-term Treasury bonds to offer “the most liquid and the most cost-efficient way of getting interest rate protection.” Simplify Interest Rate Hedge ETF is the first ETF providing a simple, direct and transparent interest rate hedge (read: 5 ETFs That Gained More Than 20% This Year).
PFIX has accumulated $340.1 million in its asset base and trades in an average daily volume of 385,000 shares. It charges 50 bps in annual fees.
ProShares VIX Short-Term Futures ETF provides long exposure to the S&P 500 VIX Short-Term Futures Index, which measures the returns of a portfolio of monthly VIX futures contracts with a weighted average of one month to expiration.
ProShares VIX Short-Term Futures ETF has amassed $298.9 million in AUM and charges 85 bps in fees per year. The fund trades in an average daily volume of around 7 million shares.
Simplify Tail Risk Strategy ETF seeks to provide income and capital appreciation while protecting against significant downside risk to investors by hedging diversified portfolios against severe equity market selloffs. The fund deploys advanced options strategies that are designed to handle multiple types of market dislocations (read: Low-Beta ETFs to Counter Market Volatility).
Simplify Tail Risk Strategy ETF has amassed $30 million in its asset base and charges 84 bps in annual fees from investors. It trades in a volume of 84,000 shares a day on average.
Advocate Rising Rate Hedge ETF is a multi-asset ETF that seeks to generate capital appreciation during periods of rising long-term interest rates, specifically interest rates, with maturities of five years or longer. It is an actively managed fund and seeks to achieve its investment objective primarily by investing in a combination of U.S. Treasury securities; forwards, futures or options on various currencies; long and short positions on the short and long-end of the Treasury or swap yield curve via futures, swaps, forwards and other over-the-counter derivatives; long and short positions on equity indexes and investment companies, including ETFs; and commodity futures and options.
Advocate Rising Rate Hedge ETF has accumulated $39 million in its asset base and charges 85 bps in annual fees. It trades in an average daily volume of 62,000 shares.
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5 Niche ETFs That Were in Green Last Week
After a strong start to December, Wall Street is again struggling to find footing as bouts of solid economic data have dampened hopes for the Fed’s slower pace of rate hikes. The S&P 500 fell 3.4%, while the Dow lost 2.8% last week. The tech-heavy Nasdaq Composite Index declined 4%.
While most of the segments suffered losses last week, a few have performed really well. Breakwave Dry Bulk Shipping ETF (BDRY - Free Report) , Simplify Interest Rate Hedge ETF (PFIX - Free Report) , ProShares VIX Short-Term Futures ETF (VIXY - Free Report) , Simplify Tail Risk Strategy ETF (CYA - Free Report) and Advocate Rising Rate Hedge ETF (RRH - Free Report) ended the week in the green.
A stronger-than-expected November report on producer prices aggravated fears about the Federal Reserve’s interest rate hikes, following a stronger-than-expected November jobs report and a robust services sector report. The producer price index climbed 0.3% for the third month and was up 7.4% from a year ago.
The economy added 263,000 jobs in November, marking another strong month of jobs growth. The unemployment rate remained at 3.7%, close to a 50-year low, while average hourly earnings jumped 0.6% from the prior month and 5.1% from the year-ago month. Higher wages should add to inflation. Meanwhile, business activity jumped the most since March 2021 in November, suggesting that the largest part of the economy remains resilient. ISM’s gauge of services rose to 56.5 last month from 54.4 in October (read: 4 Sector ETFs to Play Upbeat November Jobs Data).
Further, consumer sentiment improved in early December, with the the University of Michigan's Consumer Confidence Index rising to 59.1 from 56.8 in November.
The Fed is expected to raise interest rates by a half-percentage point in a meeting this week.
Breakwave Dry Bulk Shipping ETF (BDRY - Free Report) – Up 19.3%
Breakwave Dry Bulk Shipping ETF is the only freight futures ETF exclusively focused on the dry bulk shipping market through a portfolio of near-dated freight futures contracts on dry bulk indices. It holds freight futures with a weighted average of approximately three months to expiration, using a mix of one-to-six-month freight futures based on the prevailing calendar schedule.
Breakwave Dry Bulk Shipping ETF has accumulated about $38.8 million in AUM and trades in a good volume of about 249,000 shares per day on average. It charges a higher annual fee of 3.50%.
Simplify Interest Rate Hedge ETF (PFIX - Free Report) – Up 7.3%
Simplify Interest Rate Hedge ETF seeks to provide a hedge against a sharp increase in long-term interest rates and benefit from market stress when fixed-income volatility increases, while providing the potential for income. It buys put options on longer-term Treasury bonds to offer “the most liquid and the most cost-efficient way of getting interest rate protection.” Simplify Interest Rate Hedge ETF is the first ETF providing a simple, direct and transparent interest rate hedge (read: 5 ETFs That Gained More Than 20% This Year).
PFIX has accumulated $340.1 million in its asset base and trades in an average daily volume of 385,000 shares. It charges 50 bps in annual fees.
ProShares VIX Short-Term Futures ETF (VIXY - Free Report) – Up 6.6%
ProShares VIX Short-Term Futures ETF provides long exposure to the S&P 500 VIX Short-Term Futures Index, which measures the returns of a portfolio of monthly VIX futures contracts with a weighted average of one month to expiration.
ProShares VIX Short-Term Futures ETF has amassed $298.9 million in AUM and charges 85 bps in fees per year. The fund trades in an average daily volume of around 7 million shares.
Simplify Tail Risk Strategy ETF (CYA - Free Report) – Up 6.1%
Simplify Tail Risk Strategy ETF seeks to provide income and capital appreciation while protecting against significant downside risk to investors by hedging diversified portfolios against severe equity market selloffs. The fund deploys advanced options strategies that are designed to handle multiple types of market dislocations (read: Low-Beta ETFs to Counter Market Volatility).
Simplify Tail Risk Strategy ETF has amassed $30 million in its asset base and charges 84 bps in annual fees from investors. It trades in a volume of 84,000 shares a day on average.
Advocate Rising Rate Hedge ETF (RRH - Free Report) – Up 3.5%
Advocate Rising Rate Hedge ETF is a multi-asset ETF that seeks to generate capital appreciation during periods of rising long-term interest rates, specifically interest rates, with maturities of five years or longer. It is an actively managed fund and seeks to achieve its investment objective primarily by investing in a combination of U.S. Treasury securities; forwards, futures or options on various currencies; long and short positions on the short and long-end of the Treasury or swap yield curve via futures, swaps, forwards and other over-the-counter derivatives; long and short positions on equity indexes and investment companies, including ETFs; and commodity futures and options.
Advocate Rising Rate Hedge ETF has accumulated $39 million in its asset base and charges 85 bps in annual fees. It trades in an average daily volume of 62,000 shares.