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6 Top-Ranked ETFs Beating the Market

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With the start of the second quarter, the U.S. stock markets have regained momentum on easing coronavirus pandemic as well as unprecedented fiscal and monetary stimulus. The ultra-popular broad market fund (SPY - Free Report) has gained 13.1% in a month.

The stay-at-home and social distancing measures to contain the spread are clearly paying off as the coronavirus infection has levelled off. The progress in the development of a coronavirus vaccine or treatment also added to the strength. This has raised the possibility of reopening parts of the economy soon (read: 5 Best Sector ETFs Halfway Through April).

President Donald Trump released federal guidelines for a gradual return to normalcy in places with minimal coronavirus cases. Many of the industrial giants are hoping to revive production as soon as White House plans to slowly roll back lockdown measures. Further, the large fiscal and monetary stimulus led by the Federal Reserve and the government is fueling the stock market.

The gains came amid a deluge of weak economic data lately, which shows that the economy has been badly hit by the pandemic, as well as the recent collapse in oil price.

While there are winners in many corners of the space, several ETFs have easily crushed the market by wide margins over the past month and carry a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy). Below, we have presented a bunch of top-performing ETFs from various corners of the market that are likely to continue outperforming, should the trends prevail.

SPDR S&P Biotech ETF (XBI - Free Report) – Up 24.7%

With AUM of $4.3 billion, XBI provides equal-weight exposure across 121 biotechnology stocks by tracking the S&P Biotechnology Select Industry Index. It has 0.35% in expense ratio and trades in average daily volume of 6.2 million shares. The fund has a Zacks ETF Rank #2 with a High risk outlook (read: Coronavirus Makes Biotech ETFs Red Hot).

SPDR S&P Internet ETF (XWEB - Free Report) – Up 20.4%

This product targets the Internet corner of the broad tech space and follows the S&P Internet Select Industry Index. It charges 35 bps in annual fees and trades in a volume of 14,000 shares. With AUM of $13.2 million, the fund holds 42 stocks in its basket and carries a Zacks ETF Rank #2.

iShares Morningstar Mid-Cap Growth ETF – Up 16%

This product tracks the Morningstar Mid Growth Index and holds 175 securities in its basket. Information technology takes the largest share at 33.6% while health care and industrials also receive double-digit exposure each. The fund charges 30 bps in annual fees and trades in volume of about 23,000 shares a day. It has amassed $472.4 million and has a Zacks ETF Rank #1 with a Medium risk outlook.

Vanguard Consumer Discretionary ETF (VCR - Free Report) – Up 14.9%

This fund follows the MSCI US Investable Market Consumer Discretionary 25/50 Index and holds 295 stocks in its basket. Internet & direct marketing retail is the top sector with 34.2% of the portfolio while restaurants and home improvement retail account for the next two spots with double-digit exposure each. VCR charges investors 10 bps in annual fees while volume is moderate at nearly 111,000 shares a day. The product manages an asset base of about $2.4 billion and has a Zacks ETF Rank #2 with a Medium risk outlook (read: ETFs to Gain on Amazon's Rally Amid Coronavirus Crisis).

Invesco Dynamic Semiconductors ETF (PSI - Free Report) – Up 14.8%

This fund tracks the Dynamic Semiconductor Intellidex Index and offers exposure to companies that are principally engaged in the manufacture of semiconductors. It holds 29 securities in its basket with AUM of $212.3 million and average daily volume of 43,000 shares. Expense ratio is 0.58%. PSI has a Zacks ETF Rank #1 with a High risk outlook.

First Trust Large Cap Growth AlphaDEX Fund (FTC - Free Report) – Up 14.5%

This fund tracks the NASDAQ AlphaDEX Large Cap Growth Index, holding a basket of 188 stocks with key holdings in information technology. It has $798.2 million in AUM and charges 61 bps in annual fees. The ETF trades in average daily volume of 81,000 shares and has a Zacks ETF Rank #2 with a Medium risk outlook.

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