Image: Bigstock

After a strong start to the year, Wall Street was caught in feeble trading triggered by the Fed’s aggressive rate hike speculation in February and the bank crisis in March. With just a couple of days left to end the first quarter, the tech-heavy Nasdaq Index is the outperformer with 13% gains. The S&P 500 is up more than 4.5%, while the Dow is down 1.3%.

We have highlighted the best ETFs, each from the top five segments of the first quarter. These are Valkyrie Bitcoin Miners ETF (WGMI - Free Report), Simplify Volt Robocar Disruption and Tech ETF (VCAR - Free Report), Roundhill MEME ETF (MEME - Free Report), VanEck Vectors Video Gaming and eSports ETF (ESPO - Free Report) and Communication Services Select Sector SPDR Fund (XLC - Free Report).

The outperformance for the Nasdaq index was brought in by the fears over the financial instability caused by the failure of the series of banks. The scare has compelled investors to adopt an old strategy and flock toward mega caps’ cash-rich balance sheets and durable revenue streams.

Though inflation is at elevated levels, it is cooling down slowly and has been on a downtrend for eight consecutive months. Job gains picked up and were running at a robust pace while the unemployment rate has remained low. The recent economic indicators also pointed to modest growth in spending and production. U.S. consumer confidence unexpectedly increased in March after two straight months of decline, even as persistent inflation, bank collapses and anxiety over a possible recession weighed on American households.

Meanwhile, the Fed raised interest rates by 25 bps this month, taking the fed funds rate to 4.75-5%, the highest since October 2007. It signaled that an end to interest rate increases could be on the horizon, and some additional policy firming may be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2% over time.

ETFs in Focus

We have profiled the above-mentioned ETFs in detail below:

Valkyrie Bitcoin Miners ETF (WGMI) – Up 97.5%

Bitcoin, the largest digital currency by market value, is on track for its strongest quarter in two years with a 72% jump. Driven by the crypto rally, Valkyrie Bitcoin Miners ETF is the top-performing ETF of the first quarter. It is an actively managed ETF providing exposure to the bitcoin mining industry. WGMI invests at least 80% of its net assets (plus borrowings for investment purposes) in securities of companies that derive at least 50% of their revenues or profits from bitcoin mining operations and/or from providing specialized chips, hardware and software or other services to companies engaged in bitcoin mining.

Valkyrie Bitcoin Miners ETF holds 25 stocks in its basket and charges 75 bps in annual fees. It has amassed $6 million in its asset base while trading in an average daily volume of 60,000 shares.

Simplify Volt Robocar Disruption and Tech ETF (VCAR) – Up 27.7%

The return of appeal for the big tech names has pushed Tesla's (TSLA) stock higher lately. In fact, the stock is one of the biggest gainers in March, fueling a superb rally in VCAR. Simplify Volt Robocar Disruption and Tech ETF is an actively managed ETF seeking concentrated exposure to the leader of autonomous driving technology. It employs a call option overlay to seek boosts in performance during extreme moves up in Tesla while holding a tech index for diversification and put options as a hedge.

Simplify Volt Robocar Disruption and Tech ETF charges investors 0.95% in annual fees. It has accumulated $3.3 million in its asset base while trading in an average daily volume of 4,000 shares.

Roundhill MEME ETF (MEME) – Up 25.4%

The turnaround in the cryptocurrency and technology market has bolstered the meme rally this year. Roundhill MEME ETF is the first ETF globally explicitly designed to track the performance of meme stocks. It follows the Solactive Roundhill Meme Stock Index, which consists of equal-weighted U.S.-listed equity securities that exhibit a combination of elevated social media activity and high short interest. Roundhill MEME ETF holds 25 stocks in its basket, with none making up for more than 4.4% share.

Roundhill MEME ETF has gathered $1 million in its AUM and charges 69 bps in annual fees. It trades in a volume of 4,000 shares a day on average.

VanEck Vectors Video Gaming and eSports ETF (ESPO) – Up 21.7%
 
VanEck Video Gaming and eSports ETF offers exposure to global companies involved in video game development, e-sports and related hardware and software by tracking the MVIS Global Video Gaming and eSports Index. ESPO holds 26 stocks in its basket, with a tilt toward American firms, which account for 45.3% of the portfolio, while Japan and China round off the next two with a double-digit allocation each.

VanEck Video Gaming and eSports ETF has gathered $283.7 million in its asset base while trading in an average daily volume of 30,000 shares. ESPO charges 56 bps in annual fees from investors.

Communication Services Select Sector SPDR Fund (XLC) – Up 18.3%

Communication Services Select Sector SPDR Fund offers exposure to companies from telecommunication services, media, entertainment and interactive media & services, and has accumulated $9.3 billion in its asset base. It follows the Communication Services Select Sector Index and holds 24 stocks in its basket. About 47% of the portfolio is allocated to interactive media & services, while entertainment and media round off the next two.

Communication Services Select Sector SPDR Fund charges 10 bps in annual fees and trades in an average daily volume of 6 million shares. It has a Zacks ETF Rank #2.

More By This Author:

Quality ETFs To Buy For Market-Beating Returns Amid Turmoil
Big Tech ETFs Roar: Will The Rally Continue?
5 ETFs That Outperformed The Market Last Week