After wrapping up the first half with big gains, Wall Street has been caught in tumultuous trading lately. A combination of factors like expectations of higher rates for a longer period and a slowdown in the Chinese economy is acting as a major culprit.
However, the S&P 500 Index showed strong resilience amid volatile conditions. It underscores economic optimism and steady inflows. This is especially true as the index has not dropped 1.5% or more in the last 100 consecutive sessions for the first time since 2018. While the index has experienced four declines of more than 1% since it peaked earlier this year, daily fluctuations have generally remained subdued, reminiscent of the stability seen in 2018.
Given this, several corners of the stock market are shining this year. We have highlighted five ETFs from different corners of the investing world that have gained more than 40% this year. These include Valkyrie Bitcoin Miners ETF WGMI, MicroSectors FANG+ ETN FNGS, YieldMax TSLA Option Income Strategy ETF TSLY, SoFi Social 50 ETF SFYF and Fidelity Blue Chip Growth ETF FBCG.
Behind the Solid Performance
The economy has withstood the worst of the Fed’s policy tightening. The central bank has raised interest rates 11 times to the highest level since 2001 over the course of 16 months. This has made borrowing for everything from cars to homes to business expansions much more expensive.
Recent indicators suggest that economic activity has been expanding at a moderate pace, buoyed by robust consumer spending, strong job gains and a low unemployment rate. Notably, the economy has added 278,000 jobs per month so far this year and the unemployment rate of 3.8% is not far from a half-century low. Per the latest data, U.S. consumer spending increased by the most in six months in July as Americans bought more goods and services.
Further, corporate earnings have improved. There has been a notable improvement in the earnings outlook in recent months, with positive revisions for several key sectors since the start of the third quarter.
However, surging oil price is adding to inflationary pressure. Fed Chair Jerome Powell had indicated the possibility of further rate hikes, if needed, to ensure inflation remains under control. Though inflation remains well above the Fed’s 2% target, it has dropped from a peak of 9.1%.
Let’s dig into the details of the abovementioned ETFs:
Valkyrie Bitcoin Miners ETF (WGMI) – Up 131.8%
Valkyrie Bitcoin Miners ETF is an actively managed ETF providing exposure to the bitcoin mining industry. WGMI invests at least 80% of its net assets (plus borrowings for investment purposes) in securities of companies that derive at least 50% of their revenues or profits from bitcoin mining operations and/or from providing specialized chips, hardware and software or other services to companies engaged in bitcoin mining.
Valkyrie Bitcoin Miners ETF holds 22 stocks in its basket and charges 75 bps in annual fees. It has amassed $15.5 million in its asset base while trading in an average daily volume of 126,000 shares.
MicroSectors FANG+ ETN (FNGS) – Up 72.3%
MicroSectors FANG+ ETN is linked to the performance of the NYSE FANG+ Index, which is an equal-dollar weighted index designed to provide exposure to a group of highly traded growth stocks of next-generation technology and tech-enabled companies. It holds 10 equal-weighted stocks in its basket.
MicroSectors FANG+ ETN has accumulated $133.6 million in its asset base and charges 58 bps in annual fees. FNGS trades in an average daily volume of 215,000 shares and has a Zacks ETF Rank #3 (Hold).
YieldMax TSLA Option Income Strategy ETF (TSLY) – Up 57.6%
YieldMax TSLA Option Income Strategy ETF is an actively managed fund that seeks to generate monthly income by selling/writing call options on Tesla TSLA. It has AUM of $667.8 million and charges 99 bps in annual fees.
YieldMax TSLA Option Income Strategy ETF trades in a volume of 2 million shares per day on average.
SoFi Social 50 ETF (SFYF) – Up 42.2%
SoFi Social 50 ETF follows the SoFi Social 50 Index and is composed of the top 50 most widely held U.S. listed stocks on SoFi Invest, where the companies are measured by the number of accounts that invest in that stock. Communications is the top sector, accounting for 26.2%, while consumer cyclical (31.7%) and consumer non-cyclical (6.7%) round off the next two spots.
SoFi Social 50 ETF has amassed $15.9 million in its asset base and charges 29 bps in annual fees.
Fidelity Blue Chip Growth ETF (FBCG) – Up 41.7%
Fidelity Blue Chip Growth ETF invests in blue-chip companies (well-known, well-established and well-capitalized), which generally have large or medium market capitalizations. These companies have above-average growth potential (stocks of these companies are often called “growth” stocks). Fidelity Blue Chip Growth ETF holds 162 securities in its basket with double-digit concentration on the top two firms.
Fidelity Blue Chip Growth ETF charges 59 bps in annual fees and trades in an average daily volume of 202,000 shares. It charges 59 bps in annual fees.
Tesla, Inc. (TSLA): Free Stock Analysis Report
SoFi Social 50 ETF (SFYF): ETF Research Reports
MicroSectors FANG+ ETN (FNGS): ETF Research Reports
Fidelity Blue Chip Growth ETF (FBCG): ETF Research Reports
Valkyrie Bitcoin Miners ETF (WGMI): ETF Research Reports
YieldMax TSLA Option Income Strategy ETF (TSLY): ETF Research Reports
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