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Braving global growth concerns, the bulls are back with the S&P 500 surging to its first record close since April. The rally has been primarily fueled by the Federal Reserve, which signaled easy money policies as soon as July, given aggravating trade disputes, global recession fears and bouts of weak data.
Lower interest rates would make borrowings cheaper, providing a boost to both investment in new projects and repayment of higher-rate debt. As such, it would lead to strong economic growth and is thus a boon for the stock market. In fact, the central bank in the latest FOMC meeting hinted at future rate cuts and removed the word “patient” from its updated policy statement. It said it would act "as appropriate" in order to sustain an economic expansion of nearly 10 years. According to the CME FedWatch tool, traders are now pricing in a 100% chance of a rate cut next month (read: Sector ETFs & Stocks to Buy or Avoid Post Fed Meeting).
Additionally, the possibility of a resumption of trade talks between the United States and China later this month added to the strength. Further, oil price surge and a rise in deal activities are also driving the bulls lately. All these developments have rekindled investors’ confidence in the U.S. economy.
While there have been winners in many corners of the space, we highlight 10 ETFs that have outperformed and gained more than 30% in the year-to-date time frame. These are expected to continue outperforming, provided the fundamentals remain intact.
This ETF, which offers global exposure to 22 solar stocks, has emerged as an undisputed winner this year so far given the strongest-ever solar installation and the exemption of tariff on one type of solar panels. American firms dominate the fund’s portfolio with nearly 53.5% share, followed by China (21.6%) and Germany (6.9%). The product has amassed $350.7 million in its asset base and charges investors 70 bps in fees per year. It has a Zacks ETF Rank #3 (Hold) with a High risk outlook (read: Solar ETF Hits New 52-Week High).
Invesco DWA Technology Momentum ETF (PTF - Free Report) – Up 41.8%
The technology sector rebounded this month after a steep sell-off on cheap valuation and improved sentiments. It has again become a top performing sector this year with PTF leading the way. This fund follows the Dorsey Wright Technology Technical Leaders Index and provides exposure to technology companies that are showing relative strength (momentum). Holding 39 stocks in the basket, the product has AUM of $205.4 million and charges 60 bps in annual fees. It has a Zacks ETF Rank #2 (Buy) with a High risk outlook.
This ETF has been surging on a slew of blockbuster IPOs. It provides exposure to the 74 largest and most-liquid newly listed companies by tracking the Renaissance IPO Index. Technology is the top sector accounting for 36% share while communication services and real estate round off the next two spots with double-digit allocation each. The fund has amassed $48.3 million in its asset base and charges 60 bps in annual fees (read: 5 ETFs That More Than Doubled S&P 500 This Year).
Invesco WilderHill Clean Energy ETF (PBW - Free Report) – Up 37.9%
This product, powered by solar surge, provides exposure to 38 U.S. companies engaged in the business of advancement of cleaner energy and conservation. It has AUM of $167.1 million and expense ratio of 0.70%.
Invesco DWA NASDAQ Momentum ETF – Up 35.6%
In an uptrend market, momentum ETFs perform well compared to others. DWAQ offers exposure to 100 large-cap companies that are showing relative strength (momentum). Healthcare is the top sector accounting for more than one-third share, closely followed by information technology with 27.1% share. The product has accumulated $47.7 million in its asset base and has expense ratio of 0.60%.
The biotech sector has been on the mend amid the ongoing industry consolidation and attractive valuations. Particularly, the surge in demand for artificial intelligence in the advancement of diagnoses and treatment across the health care spectrum has been driving this ETF. This is an actively managed ETF, focusing on companies likely to benefit from the extension and enhancement of the quality of human and other life by incorporating technological and scientific developments plus improvements and advancements in genomics into their business. With AUM of $425.7 million, the fund holds 38 stocks in its basket and has 0.75% in expense ratio.
ETFMG Prime Mobile Payments ETF (IPAY - Free Report) – Up 33.2%
This ETF targets the mobile payments industry and tracks the Prime Mobile Payments Index. It capitalizes on the transition from cash/physical credit card payments to a mobile/digital system, charging investors 75 bps in annual fees. The fund holds 42 stocks in its basket with AUM of $701.6 million.
This product invests in companies on the leading edge of the emerging financial technology sector, which encompass a range of innovations helping to transform established industries like insurance, investing, fundraising, and third-party lending through unique mobile and digital solutions. With AUM of $395.3 million, it holds 42 stocks in its basket and charges 68 bps in annual fees (read: 5 Tech ETFs Braving Trade Tensions in May).
Invesco Russell MidCap Pure Growth ETF – Up 32.9%
This fund targets the growth corner of the mid-cap segment by tracking the Russell Midcap Pure Growth Index. It holds 95 securities in its portfolio with information technology being the top sector at 43.9%. The fund has amassed $660 million and charges 39 bps in annual fees. It has a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook (read: 5 ETF Strategies to Beat Sell in May and Go Away).
This fund invests in companies positioned to benefit from increased adoption of e-commerce as a distribution model, including companies whose principal business revolves around operating e-commerce platforms, providing related software and services, and/or selling goods and services online. It recently debuted in the space and has accumulated $2.8 million in its asset base since late November. It charges 68 bps in annual fees.
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S&P 500 Hits New High: 10 Top-Performing ETFs YTD
Braving global growth concerns, the bulls are back with the S&P 500 surging to its first record close since April. The rally has been primarily fueled by the Federal Reserve, which signaled easy money policies as soon as July, given aggravating trade disputes, global recession fears and bouts of weak data.
Lower interest rates would make borrowings cheaper, providing a boost to both investment in new projects and repayment of higher-rate debt. As such, it would lead to strong economic growth and is thus a boon for the stock market. In fact, the central bank in the latest FOMC meeting hinted at future rate cuts and removed the word “patient” from its updated policy statement. It said it would act "as appropriate" in order to sustain an economic expansion of nearly 10 years. According to the CME FedWatch tool, traders are now pricing in a 100% chance of a rate cut next month (read: Sector ETFs & Stocks to Buy or Avoid Post Fed Meeting).
Additionally, the possibility of a resumption of trade talks between the United States and China later this month added to the strength. Further, oil price surge and a rise in deal activities are also driving the bulls lately. All these developments have rekindled investors’ confidence in the U.S. economy.
While there have been winners in many corners of the space, we highlight 10 ETFs that have outperformed and gained more than 30% in the year-to-date time frame. These are expected to continue outperforming, provided the fundamentals remain intact.
Invesco Solar ETF (TAN - Free Report) – Up 51.2%
This ETF, which offers global exposure to 22 solar stocks, has emerged as an undisputed winner this year so far given the strongest-ever solar installation and the exemption of tariff on one type of solar panels. American firms dominate the fund’s portfolio with nearly 53.5% share, followed by China (21.6%) and Germany (6.9%). The product has amassed $350.7 million in its asset base and charges investors 70 bps in fees per year. It has a Zacks ETF Rank #3 (Hold) with a High risk outlook (read: Solar ETF Hits New 52-Week High).
Invesco DWA Technology Momentum ETF (PTF - Free Report) – Up 41.8%
The technology sector rebounded this month after a steep sell-off on cheap valuation and improved sentiments. It has again become a top performing sector this year with PTF leading the way. This fund follows the Dorsey Wright Technology Technical Leaders Index and provides exposure to technology companies that are showing relative strength (momentum). Holding 39 stocks in the basket, the product has AUM of $205.4 million and charges 60 bps in annual fees. It has a Zacks ETF Rank #2 (Buy) with a High risk outlook.
Renaissance IPO ETF (IPO - Free Report) – Up 39.1%
This ETF has been surging on a slew of blockbuster IPOs. It provides exposure to the 74 largest and most-liquid newly listed companies by tracking the Renaissance IPO Index. Technology is the top sector accounting for 36% share while communication services and real estate round off the next two spots with double-digit allocation each. The fund has amassed $48.3 million in its asset base and charges 60 bps in annual fees (read: 5 ETFs That More Than Doubled S&P 500 This Year).
Invesco WilderHill Clean Energy ETF (PBW - Free Report) – Up 37.9%
This product, powered by solar surge, provides exposure to 38 U.S. companies engaged in the business of advancement of cleaner energy and conservation. It has AUM of $167.1 million and expense ratio of 0.70%.
Invesco DWA NASDAQ Momentum ETF – Up 35.6%
In an uptrend market, momentum ETFs perform well compared to others. DWAQ offers exposure to 100 large-cap companies that are showing relative strength (momentum). Healthcare is the top sector accounting for more than one-third share, closely followed by information technology with 27.1% share. The product has accumulated $47.7 million in its asset base and has expense ratio of 0.60%.
ARK Genomic Revolution Multi-Sector ETF (ARKG - Free Report) — Up 35%
The biotech sector has been on the mend amid the ongoing industry consolidation and attractive valuations. Particularly, the surge in demand for artificial intelligence in the advancement of diagnoses and treatment across the health care spectrum has been driving this ETF. This is an actively managed ETF, focusing on companies likely to benefit from the extension and enhancement of the quality of human and other life by incorporating technological and scientific developments plus improvements and advancements in genomics into their business. With AUM of $425.7 million, the fund holds 38 stocks in its basket and has 0.75% in expense ratio.
ETFMG Prime Mobile Payments ETF (IPAY - Free Report) – Up 33.2%
This ETF targets the mobile payments industry and tracks the Prime Mobile Payments Index. It capitalizes on the transition from cash/physical credit card payments to a mobile/digital system, charging investors 75 bps in annual fees. The fund holds 42 stocks in its basket with AUM of $701.6 million.
Global X FinTech ETF (FINX - Free Report) – Up 32%
This product invests in companies on the leading edge of the emerging financial technology sector, which encompass a range of innovations helping to transform established industries like insurance, investing, fundraising, and third-party lending through unique mobile and digital solutions. With AUM of $395.3 million, it holds 42 stocks in its basket and charges 68 bps in annual fees (read: 5 Tech ETFs Braving Trade Tensions in May).
Invesco Russell MidCap Pure Growth ETF – Up 32.9%
This fund targets the growth corner of the mid-cap segment by tracking the Russell Midcap Pure Growth Index. It holds 95 securities in its portfolio with information technology being the top sector at 43.9%. The fund has amassed $660 million and charges 39 bps in annual fees. It has a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook (read: 5 ETF Strategies to Beat Sell in May and Go Away).
Global X E-commerce ETF (EBIZ - Free Report) – Up 32.9%
This fund invests in companies positioned to benefit from increased adoption of e-commerce as a distribution model, including companies whose principal business revolves around operating e-commerce platforms, providing related software and services, and/or selling goods and services online. It recently debuted in the space and has accumulated $2.8 million in its asset base since late November. It charges 68 bps in annual fees.
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 >>