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9 ETFs That Emerged Bulls From the Bottom of Bear Market

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The equity bull market turns nine on Friday. The bulls started racing on Mar 9, 2009, the day U.S. stocks finally stopped sliding after the worst market rout since the Great Depression. Nine years ago, on Mar 6, the S&P 500 touched a bear market nadir of 666.79, only to stage an astral rally. The ongoing run is the second-longest ever and requires 1,200 more days without a 20% decline to get the brand of “the king of all bull markets”.

In short, over the last decade, the global investing backdrop has witnessed various key happenings. These include the subprime mortgage crisis, the fall of the investment bank Lehman Brothers in September 2008, the U.S. losing its triple-A credit rating, the Fed’s QE to boost an economy in recession, the Euro zone debt crisis, Abenomics in Japan, the Taper Tantrum in the United States, China’s soft landing issues, oil price massacre, initiation of QE by ECB, Brexit, the start of Trump era and many more.

The net result is that the global economy is on a firm footing now. The U.S. and the Eurozone economy grew 2.3% each in 2017 while the Japanese economy expanded an annualized 1.6% in the fourth quarter versus economists’ median estimate for 0.9% annualized growth.

How Was the Journey in the Last Decade?

All in all, stocks and ETFs that held steady in the last decade actually faced both – the bottom of bear and the height of bull – and emerged winners despite all odds. The S&P 500, which declined about 46% from Mar 9, 2008 to Mar 9, 2009, gained about 9.9% in the last 10 years (as of Mar 6, 2018). SPDR Dow Jones Industrial Average ETF Trust (DIA - Free Report) was up 10.2% in the last 10 years.

Below we highlight a few key ETFs that breezed past all the glooms of a bear market and went on to beat the S&P 500 by a decent margin in the last 10-year timeframe (as of Mar 6, 2018).

First Trust Amex Biotechnology Index (FBT - Free Report) – Up 20.6%

The underlying NYSE Arca Biotechnology Index measures the performance of a cross section of companies in the biotechnology industry (read: 4 Hot Sector ETFs Springing Up to Rank #1).

First Trust Dow Jones Internet Index (FDN - Free Report) – Up 19.24%

The underlying Dow Jones Internet Composite Index includes only companies whose primary focus is Internet-related. Information Technology (68.27%) and Consumer Discretionary (22.25%) are the top two sectors.

PowerShares QQQ Trust (QQQ - Free Report) – Up 15.97%

The fund follows the Nasdaq-100 Index and is heavy on Information Technology. However, Consumer Discretionary and Health Care also have considerable exposure to it. 

iShares PHLX Semiconductor ETF (SOXX - Free Report) – Up 15.77%

The underlying PHLX SOX Semiconductor Sector Index measures the performance of U.S. traded securities of companies engaged in the semiconductor business.

PowerShares Dynamic Pharmaceuticals Portfolio (PJP - Free Report) – Up 15.68%

The underlying Dynamic Pharmaceutical Intellidex Index comprises stocks of U.S. pharmaceutical companies (read: Solid Q4 Earnings Drive Pharma ETF Outlook).

Consumer Discretionary Select Sector SPDR Fund (XLY - Free Report) –  Up 14.94%

The underlying Consumer Discretionary Select Sector represents the consumer discretionary sector of the S&P 500 Index. Internet & Direct Marketing Retail (29.5%), Media (20.9%) and Specialty Retail (17%) are the top three industries of the fund.

First Trust Health Care AlphaDEX Fund (FXH - Free Report) – Up 14.60%

The underlying StrataQuant Health Care Index employs the AlphaDEX stock selection methodology to select stocks from the Russell 1000 Index. Health Care Providers & Services and Health Care Equipment & Supplies make up about 60% of the portfolio.

iShares U.S. Aerospace & Defense ETF (ITA - Free Report) – Up 14.33%

The underlying Dow Jones U.S. Select Aerospace & Defense Index measures the performance of the aerospace and defense sector of the U.S. equity market (read: Trump Tariffs Put These Sector ETFs & Stocks in Focus).

iShares U.S. Consumer Services ETF (IYC - Free Report) – Up 14.02%

The underlying Dow Jones U.S. Consumer Services Index gives access to the consumer services sector of the U.S. equity market. The fund is heavy on Retailing (44.5%) and Media (20.8%).

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