For the first time in a while, we’re growing more optimistic on the European economy. My colleague Aneeka Gupta from WisdomTree Europe recently provided some commentary on European macroeconomics that outlined a few valuable insights.
Category: Investment
An Emerging Markets ETF for a Weak Dollar World
Treasury yields are still elevated and the dollar is still weak. However, both assets recently rallied, indicating there’s room to the downside. That could be to the benefit of emerging markets bonds and the VanEck Vectors Emerging Markets Local Currency Bond ETF EMLC
How to Handle a Bond Bear Market
It can be challenging to handle a bond bear market, a period during which investors drive bond prices down and yields—which move inversely to prices—higher. The good news is that the worst of this phase of the bond bear market may be over, and you can take steps to help mitigate the impact of increased volatility and higher interest rates.
Investors Have Grown More Comfortable with Junk Bonds
As default rates among low-rated U.S. companies dropped to their lowest level in months, fixed income investors have grown more “risk-on.” The iShares iBoxx $ High Yield Corp Bond ETF (NYSEArca: HYG) increased 0.9% year-to-date while the iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) fell 4.8%.
Play the Hot then Cold Interest Rate Standoff with ‘LQD’
As Treasury bond yields continue to tick higher, puts corporate bonds may be in a bind as fixed income investors increasingly opt for government bonds with less default risk. As the market continues to decide whether it wants to continue past its pre-pandemic levels or languish further, investors can get quality corporate bond exposure with assets like the iShares iBoxx $ Investment Grade Corporate Bond ETF (LQD) .
Lower Fees Are Driving Investors from Mutual Funds to ETFs
Proponents of exchange traded funds (ETFs) frequently cite their rock-bottom fees. According to a Kiplinger article , various studies substantiate this claim. “Numerous studies show that over the long term, managed mutual funds cannot beat an index fund, such as an ETF,” the article noted. “For example, according to the SPIVA scorecard , 75% of large cap funds ‘underperformed’ the S&P 500 over five years through Dec. 31, 2020.
How Biden’s Infrastructure Benefits Amazon and the CLOU ETF
When peeling back the layers of U.S. president Biden’s infrastructure plan, one of the key components is shoring up internet access to all Americans. This facet can help bolster cloud computing services and the Global X Cloud Computing ETF (CLOU) .
The ARKG ETF: Genomic Focus with a Twist
The ARK Genomic Revolution Multi-Sector Fund ( ARKG ) is obviously positioned as a genomics fund, but as an actively managed exchange traded fund, it can venture into other growth areas in the healthcare sector. That includes telemedicine, as highlighted by the fund’s significant exposure to Teledoc .
Value and Dividends: A Rising Tide
A rising tide of improving economic growth expectations has lifted all sectors this year. The companies getting the greatest boost in recent months were some of the most unloved and distressed in the first half of 2020. After this sharp reversal, waters may get choppier ahead.
Bank ETFs Get a Boost from Corporate Earnings
Bank stocks and ETFs have been soaring on Wednesday thanks to increases in banking profits that beat analyst expectations. JPMorgan Chase & Co. reported an almost 5 times increase in quarterly profits thanks to surging markets and an economic recovery that enabled the bank to mobilize $5.2 billion in funds that it had set aside to cover bad loans.
A Heightened Value Tilt Is All Well and Good for This MOAT ETF
Shape-shifting to the ebbs and flows of the market can help ETFs investors snag the best from today’s investing factors. One such fund is the VanEck Vectors Morningstar Wide Moat ETF (MOAT) . MOAT seeks to replicate as closely as possible the price and yield performance of the Morningstar® Wide Moat Focus Index.
The Pullback in Growth Stocks Also Devastated ESG ETFs
As investors rotated out of growth and into value, socially responsible funds that track environmental, social, and governance principles took an indirect hit. ESG strategies target themes beyond company fundamentals and have leaned heavily toward growth-oriented companies in recent years, notably through technology giants like Apple, Google’s parent company Alphabet, and Microsoft.
An Equity ETF Strategy to Max Out Diversification
ETF investors seeking to enhance their portfolio mix can consider a smart beta strategy based on a TOBAM methodology that challenges conventional diversification wisdom. In the recent webcast, 99 Problems, but Concentration Isn’t One: A New Approach to Diversification , Mark Hackett, Chief of Investment Research, Nationwide, outlined the current market environment we are in after a tough coronavirus induced pullback and subsequent rally in equities.
As the Semiconductor Shortage Deepens, Turn to VanEck’s ‘SMH’ ETF
The present chip shortage is certainly putting the pinch on various industries who need the processing power. As such, semiconductors top the fund flow leader board on ETF Database , which includes assets like the VanEck Vectors Semiconductor ETF (SMH)