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Can These 4 Strong ETF Areas of August Gain in September?
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Key Takeaways
Palladium and agriculture ETFs could benefit from supply and demand tailwinds.
Cannabis ETFs gained sharply as favorable policy expectations boosted sentiment.
Cash-cow ETFs may benefit as investors favor value and quality stocks.
Wall Street delivered an upbeat August. The S&P 500 advanced more than 2.5% in August, while the Nasdaq gained more than 3%. The Dow climbed about 1.3% for the month.
However, Wall Street closed the month on a weaker note as renewed U.S.-Iran tensions revived concerns about energy prices, inflation, Fed Chief Kevin Warsh's caution on inflation and the possibility of a September rate hike.
Note that September is historically the worst month of the year for U.S. stocks. The S&P 500 has retreated 56% of the time in September, by an average of 1.17%, per Bank of America’s Paul Ciana, who cited data dating back to 1927, as quoted on Bloomberg.
Against this backdrop, below we highlight a few strong ETF investing areas of August and take a look at whether they can rally further in September.
Palladium futures rose to a three-month high on stronger demand prospects. Tighter emissions rules and rising hybrid-vehicle adoption could support demand, while supply risks in Russia and South Africa may constrain output. However, higher Fed rate-hike expectations could weigh on the non-yielding metal, per Trading Economics.
With stronger Fed rate-hike expectations, the U.S. dollar may gain strength, which may weigh on palladium and other commodities’ prices. PALL is up 8.1% past month (as of Aug. 31, 2026).
Cannabis – AdvisorShares Pure US Cannabis ETF (MSOS - Free Report)
According to data from Fortune Business Insights, the global cannabis market is projected to reach about $1.43 trillion by 2034 from $137.67 billion in 2026.In a landmark policy shift, the Trump administration reclassified medical marijuana from a Schedule I to a Schedule III controlled substance in late April 2026, marking the most significant federal reform on cannabis in more than half a century.
While MSOS is up 17.6% over the past month, AdvisorShares Pure Cannabis ETF (YOLO - Free Report) has surged 23.4%. The momentum could continue ahead.
Agriculture – Invesco DB Agriculture ETF (DBA - Free Report)
Inclement weather and geopolitical tensions have been responsible for the rally in soft commodities like wheat, corn and soybeans. A strengthening El Niño pattern will likely keep weather conditions severe in the medium term and weigh on agricultural production.
Citi recently raised its price targets for corn, soybeans and wheat, heading into late 2026 and early 2027, due to a strengthening Super El Niño, as quoted on investing.com. Geopolitical tensions continue to influence the investing world. DBA is up 5.5% over the past month and the fundamentals are still strong.
Pacer US Cash Cows 100 ETF (COWZ - Free Report) and VictoryShares Free Cash Flow ETF (VFLO - Free Report) are rising because investors are rotating toward free-cash-flow, value and quality stocks while broadening exposure beyond the expensive mega-cap growth trade amid rising long-term bond yields. The trend could continue in September. COWZ is up 7.3% over the past month.
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Can These 4 Strong ETF Areas of August Gain in September?
Key Takeaways
Wall Street delivered an upbeat August. The S&P 500 advanced more than 2.5% in August, while the Nasdaq gained more than 3%. The Dow climbed about 1.3% for the month.
However, Wall Street closed the month on a weaker note as renewed U.S.-Iran tensions revived concerns about energy prices, inflation, Fed Chief Kevin Warsh's caution on inflation and the possibility of a September rate hike.
Note that September is historically the worst month of the year for U.S. stocks. The S&P 500 has retreated 56% of the time in September, by an average of 1.17%, per Bank of America’s Paul Ciana, who cited data dating back to 1927, as quoted on Bloomberg.
Against this backdrop, below we highlight a few strong ETF investing areas of August and take a look at whether they can rally further in September.
Inside ETF Areas That Are in High Momentum
Palladium – abrdn Physical Palladium Shares ETF PALL
Palladium futures rose to a three-month high on stronger demand prospects. Tighter emissions rules and rising hybrid-vehicle adoption could support demand, while supply risks in Russia and South Africa may constrain output. However, higher Fed rate-hike expectations could weigh on the non-yielding metal, per Trading Economics.
With stronger Fed rate-hike expectations, the U.S. dollar may gain strength, which may weigh on palladium and other commodities’ prices. PALL is up 8.1% past month (as of Aug. 31, 2026).
Cannabis – AdvisorShares Pure US Cannabis ETF (MSOS - Free Report)
According to data from Fortune Business Insights, the global cannabis market is projected to reach about $1.43 trillion by 2034 from $137.67 billion in 2026.In a landmark policy shift, the Trump administration reclassified medical marijuana from a Schedule I to a Schedule III controlled substance in late April 2026, marking the most significant federal reform on cannabis in more than half a century.
While MSOS is up 17.6% over the past month, AdvisorShares Pure Cannabis ETF (YOLO - Free Report) has surged 23.4%. The momentum could continue ahead.
Agriculture – Invesco DB Agriculture ETF (DBA - Free Report)
Inclement weather and geopolitical tensions have been responsible for the rally in soft commodities like wheat, corn and soybeans. A strengthening El Niño pattern will likely keep weather conditions severe in the medium term and weigh on agricultural production.
Citi recently raised its price targets for corn, soybeans and wheat, heading into late 2026 and early 2027, due to a strengthening Super El Niño, as quoted on investing.com. Geopolitical tensions continue to influence the investing world. DBA is up 5.5% over the past month and the fundamentals are still strong.
Cash Cows – Pacer US Cash Cows 100 ETF (COWZ - Free Report)
Pacer US Cash Cows 100 ETF (COWZ - Free Report) and VictoryShares Free Cash Flow ETF (VFLO - Free Report) are rising because investors are rotating toward free-cash-flow, value and quality stocks while broadening exposure beyond the expensive mega-cap growth trade amid rising long-term bond yields. The trend could continue in September. COWZ is up 7.3% over the past month.