“Since inception, WGRO maintained an over-weight allocation to the Consumer Discretionary sector relative to the S&P 500 and Russell 1000 Growth Indexes.Currently, WGRO allocates almost 19% of its roster to consumer cyclical stocks, making its third-largest sector weight a significant overweight to that group relative to the S&P 500.
According to data analytics firm Adara, hotel bookings in the U.S. for business purposes are skyrocketing among travelers from Europe, the Middle East and Africa (EMEA). According to its most recent report, the U.S. trade group believes airline revenues could fully recover to 2019 levels by the second half of next year.
In April 2020, OPEC made the unprecedented decision to clip nearly 10 million barrels per day from the market as the pandemic sapped demand for petroleum products. However, if the Biden administration and its allies are able to successfully release crude into the markets, short ETFs like the ProShares UltraShort Bloomberg Crude Oil (SCO) could see considerable gains, even if short-lived.
Low-volatility exchange traded funds and their underlying indexes are, for the most part, intended to be sector agnostic. Perhaps not surprisingly, SPLV currently allocates about 40% of its weight to the consumer staples and utilities sectors, two groups with long-running reputations for being docile relative to other sectors.
The upcoming holiday travel season would appear to be an opportune time to consider an exchange traded fund such as the ALPS Global Travel Beneficiaries ETF ( JRNY ), but investors might not want wait much longer because some JRNY components are already surging.
Financial advisors who are looking for an edge can consider several unique approaches for these unprecedented markets. In the recent webcast, Why Sector and Factor Rotation May Solve Today’s Market Puzzle , Matthew Bartolini, head of SPDR® Americas research at State Street Global Advisors, noted the benefits of sector-specific exchange traded funds that have helped investors gain exposure to specific market segments and target rising trends.
Smaller energy companies have been more nimble in capitalizing on the surge in crude oil prices, helping exchange traded funds that track the small-cap energy segment outperform.
Transitory to long-term inflation forecasts and an energy crisis could provide an economic backdrop for base metals and the Invesco DB Base Metals Fund (DBB) to thrive. Rising oil prices are causing consumers pain at the pump, while the macroeconomic environment is seeing high prices across the board for commodities.
The Barron’s 400 ETF (BFOR US) , an NYSE Arca -listed ETF tracking the Barron’s 400 Index (B400), has pivoted towards cyclical sectors following the semi-annual reconstitution and rebalance of its underlying index. B400 has pivoted towards cyclical sectors following its latest reconstitution.
Energy exchange traded funds continue to strengthen as a global energy crunch supports strong demand heading into the winter months. On Friday, the ALPS Alerian MLP ETF (NYSEArca: AMLP) increased 0.3%, and the JPMorgan Alerian MLP Index ETN (NYSEArca: AMJ) advanced 0.3%.The more widely observed Energy Select Sector SPDR Fund (NYSEArca: XLE) was 0.6% higher.
Perhaps at just the right time, the Barron’s 400 ETF (NYSEArca: BFOR ) is getting a bit more cyclical while dialing back exposure to some corners of the market that can struggle when interest rates rise. The Barron’s 400 Index (B400), BFOR’s underlying index, recently completed its most recent semi-annual reconstitution and replaced 175, or almost 44%, of its components.
As the 2020 coronavirus bear market reminds investors, airline equities can be vexing propositions, but the group does offer some near- to medium-term potential. For investors that want to capitalize on that trend without a full commitment, the ALPS Global Travel Beneficiaries ETF (NYSEARCA: JRNY) stands as a credible idea.
The broad equity markets continue to see an increased level of volatility, driven by technology-related securities. While the S&P 500 is in a bullish Market State, it is seeing an increased range of fluctuation, which it has not seen in several months.
Value stocks and related exchange traded funds outperformed on Monday as investors ditched technology names and turned to more sensitive sectors that could benefit from the improving economy. “What we’re seeing is a change in the season, and it’s shifting to some of the more cyclical areas of the market,” Robert Pavlik, senior portfolio manager at Dakota Wealth, told Reuters .
