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Wall Street delivered downbeat performances last week due to rising rates. The S&P 500 (down 2.1%), the Dow Jones (down 2.2%), the Nasdaq (down 2.6%) and the Russell 2000 (down 3.1%) – all slumped last week.
The latest Fed minutes last week shed light on the discussions surrounding inflation and the need for further rate hikes. A significant division among members was evident, with various viewpoints on the appropriate course of action. However, the majority of members see "significant upside risks" to inflation (read: More Rate Hikes in Cards On Sticky Inflation? ETFs to Buy).
This has raised the Treasury bond yields. The benchmark U.S. Treasury yields started the week at 4.19%, hit a high of 4.30% and ended the week at 4.26%. The U.S. dollar ETF UUP added 0.7% last week. Niche ETFs like Global X Interest Rate Hedge ETF (RATE - Free Report) , which offer protection against rising rates, rose 5.3% in the week (read: ETF Strategies to Fight Rising Rates).
Meanwhile, the pain in China’s real estate sector seems to be intensifying with back-to-back bad news coming from the space. While default fears of bond payments by developer Country Garden are mounting, China’s property giant Evergrande filed for U.S. bankruptcy protection.
Notably, Evergrande defaulted on its huge debts in 2021, which sent shockwaves through the global financial markets. In fact, the news from China has boosted the risk-off trade sentiments to some extent to close out the week (read: China's Country Garden Contagion: ETFs to Lose/Win).
Meanwhile, Japan's economy demonstrated remarkable resilience in Q2, defying projections with robust growth of 6.0% on an annualized basis. This translated into a striking quarterly gain of 1.5%, far surpassing median estimates of 0.8% in a Reuters poll, as quoted on CNN. However, the growth was bolstered by export strength, which seems unsustainable (read: Japan's GDP Growth Beats Expectations: ETFs to Play).
Coming to the United States, corporate earnings releases appear in good shape. Retail giant Walmart (WMT - Free Report) reported robust second-quarter fiscal 2024 results last week, wherein it surpassed both earnings and revenue estimates and raised its outlook for the full year. Cisco Systems (CSCO - Free Report) , too, beat on both lines and issued an optimistic guidance.
Against this backdrop, below we highlight a few best-performing ETFs of last week.
ETFs in Focus
Simplify Tail Risk Strategy ETF ) – Up 8.4%
The Simplify Tail Risk Strategy ETF seeks to provide investors with a standalone solution for hedging diversified portfolios against severe equity market selloffs. The fund charges 84 bps in fees.
The underlying S&P 500 VIX Short-Term Futures Index measures the movements of a combination of VIX futures and is designed to track changes in the expectation for one month in the future. The fund charges 85 bps in fees.
The Simplify Interest Rate Hedge ETF seeks to hedge interest rate movements arising from rising long-term interest rates, and to benefit from market stress when fixed income volatility increases, while providing the potential for income. The fund charges 50 bps in fees.
AdvisorShares Dorsey Wright Short ETF (DWSH - Free Report) ) – Up 4.9%
The AdvisorShares Dorsey Wright Short ETF is actively-managed with an investment focus that involves buying securities that have appreciated in price more than the other securities in the investment universe and holding those securities until they underperform. The annual expense ratio of the fund is 2.77%.
The AdvisorShares Ranger Equity Bear ETF seeks capital appreciation through short sales of domestically traded equity securities. The expense ratio of the fund is 4.29%.
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Best ETFs of Last Week
Wall Street delivered downbeat performances last week due to rising rates. The S&P 500 (down 2.1%), the Dow Jones (down 2.2%), the Nasdaq (down 2.6%) and the Russell 2000 (down 3.1%) – all slumped last week.
The latest Fed minutes last week shed light on the discussions surrounding inflation and the need for further rate hikes. A significant division among members was evident, with various viewpoints on the appropriate course of action. However, the majority of members see "significant upside risks" to inflation (read: More Rate Hikes in Cards On Sticky Inflation? ETFs to Buy).
This has raised the Treasury bond yields. The benchmark U.S. Treasury yields started the week at 4.19%, hit a high of 4.30% and ended the week at 4.26%. The U.S. dollar ETF UUP added 0.7% last week. Niche ETFs like Global X Interest Rate Hedge ETF (RATE - Free Report) , which offer protection against rising rates, rose 5.3% in the week (read: ETF Strategies to Fight Rising Rates).
Meanwhile, the pain in China’s real estate sector seems to be intensifying with back-to-back bad news coming from the space. While default fears of bond payments by developer Country Garden are mounting, China’s property giant Evergrande filed for U.S. bankruptcy protection.
Notably, Evergrande defaulted on its huge debts in 2021, which sent shockwaves through the global financial markets. In fact, the news from China has boosted the risk-off trade sentiments to some extent to close out the week (read: China's Country Garden Contagion: ETFs to Lose/Win).
Meanwhile, Japan's economy demonstrated remarkable resilience in Q2, defying projections with robust growth of 6.0% on an annualized basis. This translated into a striking quarterly gain of 1.5%, far surpassing median estimates of 0.8% in a Reuters poll, as quoted on CNN. However, the growth was bolstered by export strength, which seems unsustainable (read: Japan's GDP Growth Beats Expectations: ETFs to Play).
Coming to the United States, corporate earnings releases appear in good shape. Retail giant Walmart (WMT - Free Report) reported robust second-quarter fiscal 2024 results last week, wherein it surpassed both earnings and revenue estimates and raised its outlook for the full year. Cisco Systems (CSCO - Free Report) , too, beat on both lines and issued an optimistic guidance.
Against this backdrop, below we highlight a few best-performing ETFs of last week.
ETFs in Focus
Simplify Tail Risk Strategy ETF ) – Up 8.4%
The Simplify Tail Risk Strategy ETF seeks to provide investors with a standalone solution for hedging diversified portfolios against severe equity market selloffs. The fund charges 84 bps in fees.
ProShares VIX Short-Term Futures ETF (VIXY - Free Report) ) – Up 7.9%
The underlying S&P 500 VIX Short-Term Futures Index measures the movements of a combination of VIX futures and is designed to track changes in the expectation for one month in the future. The fund charges 85 bps in fees.
Simplify Interest Rate Hedge ETF (PFIX - Free Report) ) – Up 7%
The Simplify Interest Rate Hedge ETF seeks to hedge interest rate movements arising from rising long-term interest rates, and to benefit from market stress when fixed income volatility increases, while providing the potential for income. The fund charges 50 bps in fees.
AdvisorShares Dorsey Wright Short ETF (DWSH - Free Report) ) – Up 4.9%
The AdvisorShares Dorsey Wright Short ETF is actively-managed with an investment focus that involves buying securities that have appreciated in price more than the other securities in the investment universe and holding those securities until they underperform. The annual expense ratio of the fund is 2.77%.
AdvisorShares Ranger Equity Bear ETF (HDGE - Free Report) ) – Up 4.5%
The AdvisorShares Ranger Equity Bear ETF seeks capital appreciation through short sales of domestically traded equity securities. The expense ratio of the fund is 4.29%.