In our 2021 outlook, we unveiled a visual highlighting the “K-shaped” nature of the COVID era, as seen below. In this report, we’ll share our thoughts on these divergences; including which are likely to persist, and which are already starting to converge.
In modest allocations, emerging markets assets are functional in retirement portfolios and that’s particularly true on the fixed income side. Enter the VanEck Vectors Emerging Markets Local Currency Bond ETF ( EMLC A- ). EMLC seeks to replicate the price and yield performance of the J.P. Morgan GBI -EM Global Core Index.
Entering 2021, it was widely expected that emerging markets assets would continue penning the redemption story they started late last year. That scenario could prove rewarding for active managers. The Federal Reserve’s commitment to keep rates low could keep on fueling a weaker dollar.
The Federal Reserve chose to keep rates in check yesterday. The U.S. dollar unexpectedly rose following the announcement, but it could be short-lived, warranting the case for a dollar hedging strategy through ETFs like the Xtrackers MSCI EAFE Hedged Equity ETF ( DBEF B+ ). “With the Federal Reserve holding its first monetary policy meeting of the year, it would be easy to attribute today’s U.S. dollar rally to the central bank’s comments,” writes Kathy Lien for Investing.com
After the U.S., China is home to the most robust collection of companies credibly sporting the disruptive growth and innovative labels. What Happened : Those traits are captured in a new exchange-traded fund: The KraneShares SSE STAR Market 50 Index ETF (NYSE: KSTR ). The newest addition to KraneShares famed lineup of China and emerging market ETFs, KSTR tracks the Shanghai Stock Exchange (SSE) Science and Technology Innovation Board 50 Index. “The Index is comprised of the 50 largest companies listed on the SSE Science and Technology Innovation Board (STAR Market) as determined by market capitalization and liquidity,” according to KraneShares .
As the ETF space continues to grow, cost is one way providers can differentiate themselves from the competition. One fund, the Xtrackers MSCI Emerging Markets ESG Leaders Equity ETF (EMSG) , gives investors emerging markets and environmental, social, and governance (ESG) exposure at a low 0.20% expense ratio.
The direction of the overall stock market in 2021 could be very misleading and could mask a significant shift in underlying market leadership. In other words, the stock market might do well or not, but the potential for a major shift in market leadership could present significant investment opportunities.
Getting quality and value in bond exposure is an added plus when it comes to high yield debt investing. Thankfully ETF investors can get both with the iShares Edge High Yield Defensive Bond ETF (HYDB) . HYDB seeks to track the investment results of the BlackRock High Yield Defensive Bond Index.
High-yield corporate bonds are off to solid starts in the new year. But that’s not license for investors to take on too much risk. In fact, now’s a good time to implement quality with junk bonds via the FlexShares High Yield Value-Scored Bond Index Fund (NYSEArca: HYGV ) .
As the capital markets continue to swarm with activity over a renewed risk-on from investors and Reddit forums, there’s no shortage of volume occurring in
Across the globe, quality stocks were among the best performers in 2020, as companies with high profitability maintained an earnings edge despite Covid-19’s impact on the economy. The WisdomTree U.S. Quality Dividend Growth Fund (DGRW) , which seeks to track the WisdomTree U.S. Quality Dividend Growth Index (WTDGI) , selects companies that look attractive according measures of profitability like return-on-equity (ROE) and return-on-assets (ROA) , and earnings growth prospects, and weights them by their dividend stream .
2021 has already been a fickle year for the big banks. The group of JP Morgan, Citigroup, Bank of America, Goldman Sachs, Wells Fargo, and Morgan Stanley mostly reported Q4 earnings and revenue above consensus analyst estimates, keeping with the long-term trend.
By Rob Glownia, CFA, CFP, Senior Portfolio Manager, Co-Head of Investment Committee Global Equity CIO, Adam Grossman & Global Fixed Income Co-CIO, Kevin Nicholson Since November, we’ve participated in many calls with financial advisors and their clients to talk about the implications of the election and how to think about markets in 2021.
Social distancing is helping to push the needle toward more telemedicine, which bodes well for ETFs like the Global X Telemedicine and Digital Health ETF (EDOC) . The fund is up 9% to start 2021. “Once considered to be merely a novel way to connect doctors with patients, telemedicine now is recognized as an essential tool in the fight to overcome Covid-19,” a Forbes article noted. “Since the start of this pandemic, there has been a nationwide push for treating non-emergency physical and mental illnesses with virtual office visits.
