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5 ETFs Less Likely to Play a Prank With You in April
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So what if April Fools’ Day has passed? The investing world may still mess with you anytime over the month. Though April is a seasonally strong month for stocks, this year we have plenty of reasons to worry about.
The first quarter was not okay with rising rate fears, trade tensions and upheavals in the tech space. In mid-March, Wall Street even suffered its worst week in more than two years thanks to a trade war between the United States and China (read: 5 Reason Why FANG ETFs Lost Their Charm in March).
April also started on a rough note, but the month has a reputation of giving solid returns. A consensus carried out from 1950 to 2017 shows that April ended up offering positive stock returns in 47 years and negative returns in 21 years, per moneychimp.com, with an average return of positive 1.34%.
Against this backdrop, let’s see if there are any investments that are less likely to fool investors this month, rather than live up to the historical fame of April.
First Trust NASDAQ Technology Dividend Index Fund (TDIV - Free Report)
Since the tech space was crushed in March, buying the dip could the right technique to gain over the long term. After all, fundamentals are pretty strong in the market. Tech behemoths hoard huge cash overseas and are poised to benefit the most from Trump's repatriation tax policy. Also, investors can expect higher dividend distribution or share buyback from this move (read: Is the Rout in Tech ETFs Transitory?).
Rising enterprise spending and emerging technologies like cloud computing, artificial intelligence and big data are the other positives. However, given the wobbliness of sentiment around this area, some sort of value quotient is warranted at this moment. So, it is better to play this area with TDIV, which is a dividend rich fund.
As the roaring Trump trade lost has some steam this year and the “sell in May and go away” activity is approaching, it is wiser to have a value ETF in the basket The fund includes U.S. large- and mid-capitalization stocks. Information Technology (25.5%) and Financials (14.5%) are top two sectors (read: Why Value ETFs May Rule in Q2).
This fund caters to the global consumer staple sector. With most global economies still practicing low rates, this slightly rate-sensitive ETF tends to fare better. The sector’s safe nature is another positive. The fund is half invested in the United States where consumer spending is tasseling out.
The fund is likely to be a great beneficiary of the spring travel season. Airlines for America guided that air travel is expected to reach an all-time high of 150.7 million (2.47 million passengers) per day) between Mar 1 and Apr 30, up 4% from last year. The sector came up with mixed-to-upbeat Q4 earnings. All these call for investing in this Zacks Rank #2 fund (read: ETFs & Stocks to Fly High on Record Spring Travel).
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5 ETFs Less Likely to Play a Prank With You in April
So what if April Fools’ Day has passed? The investing world may still mess with you anytime over the month. Though April is a seasonally strong month for stocks, this year we have plenty of reasons to worry about.
The first quarter was not okay with rising rate fears, trade tensions and upheavals in the tech space. In mid-March, Wall Street even suffered its worst week in more than two years thanks to a trade war between the United States and China (read: 5 Reason Why FANG ETFs Lost Their Charm in March).
April also started on a rough note, but the month has a reputation of giving solid returns. A consensus carried out from 1950 to 2017 shows that April ended up offering positive stock returns in 47 years and negative returns in 21 years, per moneychimp.com, with an average return of positive 1.34%.
Against this backdrop, let’s see if there are any investments that are less likely to fool investors this month, rather than live up to the historical fame of April.
First Trust NASDAQ Technology Dividend Index Fund (TDIV - Free Report)
Since the tech space was crushed in March, buying the dip could the right technique to gain over the long term. After all, fundamentals are pretty strong in the market. Tech behemoths hoard huge cash overseas and are poised to benefit the most from Trump's repatriation tax policy. Also, investors can expect higher dividend distribution or share buyback from this move (read: Is the Rout in Tech ETFs Transitory?).
Rising enterprise spending and emerging technologies like cloud computing, artificial intelligence and big data are the other positives. However, given the wobbliness of sentiment around this area, some sort of value quotient is warranted at this moment. So, it is better to play this area with TDIV, which is a dividend rich fund.
iShares Edge MSCI USA Value Factor ETF (VLUE - Free Report)
As the roaring Trump trade lost has some steam this year and the “sell in May and go away” activity is approaching, it is wiser to have a value ETF in the basket The fund includes U.S. large- and mid-capitalization stocks. Information Technology (25.5%) and Financials (14.5%) are top two sectors (read: Why Value ETFs May Rule in Q2).
Financial Select Sector SPDR Fund (XLF - Free Report)
Financial stocks perform better in a rising rate environment. Also, bank stocks enjoy seasonality in April. Also, the sector is the most-undervalued among the SPDR select sector ETFs. This makes XLF an intriguing pick (read: Buffett Backs Great Rotation: 4 Value Stocks & ETFs to Buy).
iShares Global Consumer Staples ETF(KXI - Free Report)
This fund caters to the global consumer staple sector. With most global economies still practicing low rates, this slightly rate-sensitive ETF tends to fare better. The sector’s safe nature is another positive. The fund is half invested in the United States where consumer spending is tasseling out.
U.S. Global Jets ETF (JETS - Free Report)
The fund is likely to be a great beneficiary of the spring travel season. Airlines for America guided that air travel is expected to reach an all-time high of 150.7 million (2.47 million passengers) per day) between Mar 1 and Apr 30, up 4% from last year. The sector came up with mixed-to-upbeat Q4 earnings. All these call for investing in this Zacks Rank #2 fund (read: ETFs & Stocks to Fly High on Record Spring Travel).
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>