5 Market-Beating Sector ETFs Of 2019

Braving all hurdles including recession fears, trade dispute, Brexit and geopolitical tensions, Wall Street has enjoyed a huge rally this year with all the three major indices hitting record highs lately. This is especially thanks to trade optimism, stronger-than-expected earnings, a dovish Fed, and steady yet gradually improving economy.

In fact, the S&P 500 is on track to register its best performance since 2013 and the third-strongest annual gain since the start of the century, having gained 27.9% so far this year. Meanwhile, the Nasdaq and the Dow Jones are up 34% and 21.6%, respectively.

Since many corners of the equity world witnessed a solid run, a few sector ETFs performed incredibly, thereby comfortably crushing the broader markets. Below, we have highlighted five such funds that have been the 2019 star performers and could also be winners in the New Year if the current trends continue.

Invesco Solar ETF (TAN - Free Report) – Up 65%

This ETF, which offers global exposure to 22 solar stocks, has been rising on strong solar installation, a rebound in global solar demand, California’s push to make solar panels and competitive pricing. American firms dominate the fund’s portfolio with nearly 45.2% share, followed by China (25.6%) and Germany (9.2%). The product has amassed $432.6 million in its asset base and trades in average daily volume of 233,000 shares. It charges investors 70 bps in fees per year and has a Zacks ETF Rank #2 (Buy) with a High risk outlook.

VanEck Vectors Semiconductor ETF (SMH - Free Report) - Up 62.8%

Semiconductors are shining and leading the broader technology sector on trade optimism as chip stocks have a lot of exposure to China. They derive a large portion of their revenues from China since it is the world’s biggest chip market and have supply chains in the country. While all the semiconductor ETFs have risen, SMH is the biggest winner. This fund provides exposure to 25 semiconductor companies by tracking the MVIS US Listed Semiconductor 25 Index. It has managed assets worth $1.6 billion and charges 35 bps in annual fees and expenses. The ETF trades in average daily volume of 4.6 million shares and has a Zacks ETF Rank #2 with a High-risk outlook.

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