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5 Best-Performing ETFs of Dow's Biggest Rally in 87 Years

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After days of relentless slide, the U.S. equity market showed a strong rebound with Dow Jones rising more than 11%, recording its best day since 1933. The S&P 500 Index had its strongest session since 2008, while the Nasdaq registered its best performance in seven days. Energy sector climbed the most, up 16.3% in the last trading session followed by 12% rise in industrials and financials.

The huge gains came on the heels of optimism that U.S. lawmakers were nearing a deal on injecting nearly $2 trillion of aid into an economy ravaged by the coronavirus. The pandemic, which has infected more than 375,000 people and caused 16,362 deaths, has resulted in lockdown in many countries, thus halting business and economic activity (read: Coronavirus Scare Supports These Biotech ETFs & Stocks).

Finally, the Senate leaders and the Trump administration reached an agreement early today on a $2 trillion stimulus package to rescue the economy from the coronavirus assault, setting the stage for swift passage of the massive legislation through both chambers of Congress. The stimulus bill, by far the largest ever, aims to flood the economy with capital by sending $1,200 checks to many Americans, creating a $367 billion loan program for small businesses and setting up a $500 billion fund for industries, cities and states. Other provisions include a massive boost to unemployment insurance, $150 billion for state and local stimulus funds and $130 billion for hospitals.

The new deal added to aggressive action announced by the Federal Reserve in recent days. After slashing interest rates to near zero and offering to buy more government bonds and mortgage-backed securities as needed to support smooth market functioning, the Fed will now lend against student loans and credit card loans, as well as back the purchase of corporate bonds and direct loans to companies. This represents the most extreme intervention in the economy by the central bank in its history of more than 100 years.

With the stimulus deal reached, the worst seems to be over and stocks are likely to see gains in the weeks ahead amid the shutdowns. Below we have highlighted those ETFs that gained the most on the last trading day.

U.S. Global Jets ETF (JETS - Free Report) – Up 19%

This ETF offers investors access to the global airline industry including airline operators and manufacturers from all over the world by tracking the U.S. Global Jets Index. In total, the product holds 34 securities and charges 60 bps in annual fees. It has gathered $198.9 million in its asset base and sees moderate trading volume of nearly 257,000 shares a day. It has a Zacks ETF Rank #3 (Hold) with a High risk outlook (read: Sector ETFs in Focus Amid Coronavirus Rout).

VanEck Vectors Junior Gold Miners ETF (GDXJ - Free Report) – Up 18.7%

GDXJ is a small-cap centric ETF that tracks the MVIS Global Junior Gold Miners Index. Holding 79 stocks in its basket, Canadian firms dominate the fund’s portfolio at 43.3%, while Australia (23.6%) and South Africa (12.7%) round out the top three. The product has AUM of $3.4 billion and charges 53 bps in annual fees. It trades in heavy volume of around 18.5 million shares a day on average (read: 5 Surprising ETF Winners Amid Stimulus-Fed Wall Street Rally).

VanEck Vectors Unconventional Oil & Gas ETF (FRAK - Free Report) - Up 18.1%

This ETF provides exposure to the unconventional oil and gas segment, which includes coal bed methane, coal seam gas, shale oil, shale gas, tight natural gas, tight oil, tight sands, in situ oil sands, and enhanced oil recovery. This fund follows the MVIS Global Unconventional Oil & Gas Index, holding 35 stocks in the basket. It has amassed $5.2 million in its asset base and average daily volume of 18,000 shares. The product charges 54 bps in annual fees. It has a Zacks ETF Rank #5 (Strong Sell) with a High risk outlook (read: Global Oil Price War Begins: ETFs in Focus).

iShares U.S. Home Construction ETF (ITB - Free Report) – Up 16.6%

This ETF provides exposure to U.S. companies that manufacture residential homes by tracking the Dow Jones U.S. Select Home Construction Index. It holds a basket of 44 stocks and charges 42 bps in annual fees. Homebuilding takes the top spot at 59.7%, followed by 14.9% in building products and 12.4% in home improvement retail. The product has amassed $585.3 million in its asset base and trades in heavy volume of around 2.8 million shares a day on average. It charges 42 bps in annual fees and has a Zacks ETF Rank #2 (Buy) with a High risk outlook (read: Is it Wise to Buy Housing ETFs Right Now?).

Invesco Dynamic Leisure and Entertainment ETF (PEJ - Free Report) – Up 16.2%

This fund tracks the Dynamic Leisure and Entertainment Intellidex Index and offers exposure to the companies engaged in the design, production or distribution of goods or services in the leisure and entertainment industries. It holds a small basket of 30 stocks. The ETF has amassed $37.1 million in its asset base and has 0.63% in expense ratio. PEJ trades in paltry volume of 35,0000 shares and has a Zacks ETF Rank #3 with a High risk outlook.

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