The US markets have experienced some surprising volatility in the first month of 2021 driven by crowdsourced euphoria and vigilantism from a Reddit investment group. Stories about GameStop, AMC, and Altcoins have consumed financial media while the S&P 500 printed a negative return for January. Despite all the 1999-like focus on astronomical and unsustainable returns from individual stocks, we note that 42 unlevered equity ETFs returned 10% or more in the first month of 2021. Since the number 42 is the “Answer to the Ultimate Question of Life, the Universe, and Everything,” we thought we would revisit this light-hearted nerdy number and look at these 42 ETFs outperforming in 2021 and review the list of top-performers from 2020.
A Few Surprises
Below is the list of the top 42 equity ETFs that have returned 10% or more in January of 2021. At the top, we have two funds that benefited from the rise in GameStop: SPDR® S&P Retail ETF (XRT) and ETFMG Video Game Tech ETF (GAMR). Followed then by a resurgence in Cannabis-related funds, which are recovering from a difficult 2020. In that same boat, small caps and energy have started 2021 with relatively good returns. Finally, some of the clean technology, biotech, and innovation ETFs that dominated the performance leader boards in 2020 have continued to perform well in January.
What Have You Done for Me, Lately?
Now let’s look at the 42-top performing unlevered equity ETFs from 2020. First off, it is amazing to see that 18 ETFs returned over 100%! The leader board was dominated by clean energy, innovation, and mega-trend themes that experienced accelerated adoption due the pandemic response. There were seven ETFs that made the list in both years:
Obviously, this is all hindsight, but the data does suggest that despite erratic and volatile markets, ETF investors still have the opportunity to participate in great relative returns. And to paraphrase the Redditor’s last week, let’s continue to drive ETFs “to the moon!”
Disclosure
The information provided here is for financial professionals only and should not be considered an individualized recommendation or personalized investment advice. The investment strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment strategy for his or her own particular situation before making any investment decision.
All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third party providers is obtained from what are considered reliable sources. However, its accuracy, completeness or reliability cannot be guaranteed.
Examples provided are for illustrative purposes only and not intended to be reflective of results you can expect to achieve.
All investments involve risk, including possible loss of principal.
The value of investments and the income from them can go down as well as up and investors may not get back the amounts originally invested, and can be affected by changes in interest rates, in exchange rates, general market conditions, political, social and economic developments and other variable factors. Investment involves risks including but not limited to, possible delays in payments and loss of income or capital. Neither Toroso nor any of its affiliates guarantees any rate of return or the return of capital invested. This commentary material is available for informational purposes only and nothing herein constitutes an offer to sell or a solicitation of an offer to buy any security and nothing herein should be construed as such. All investment strategies and investments involve risk of loss, including the possible loss of all amounts invested, and nothing herein should be construed as a guarantee of any specific outcome or profit. While we have gathered the information presented herein from sources that we believe to be reliable, we cannot guarantee the accuracy or completeness of the information presented and the information presented should not be relied upon as such. Any opinions expressed herein are our opinions and are current only as of the date of distribution, and are subject to change without notice. We disclaim any obligation to provide revised opinions in the event of changed circumstances.
