Global equities swooned as investors react to the widely spreading COVID-19 virus outbreak's impact on global economic growth. From their record highs the
Dow 30 Tracking ETF (DOW), S&P 500 Tracking ETF (SPY) and the NASDAQ Tracking ETF (ONEQ) had at one point corrected over 15% before
recovering slightly at the end of the week.
With volatility spiking to not recently seen levels, the ProShares Trust VIX Short Term Futures ETF (VIXY) is up nearly +95% for the year. Considering
recent developments it appears volatility is not going anywhere anytime soon.
With the Fed cutting the Fed Funds Rate by 50 basis points, rate sensitive securities have seen sharp price gains over the past few weeks. The PIMCO 25-Year Zero Coupon
Treasury Index ETF (ZROZ) is now up +35% for the year.
Safe haven asset classes are continuing to gain investor attention and the yellow metal is continuing to remain as a true safe haven. The SPDR Gold Trust ETF (GLD) is up +10.25%
for the year.
These above mentioned ETFS are by no means growth-oriented though they may be temporarily timely considering recent developments. Self-directed investors should not assume these
ETFS will continue to march higher straight-up.
The watch-word to remember here is volatility.
Self-directed investors with a longer term perspective may want to keep an eye on the following three ETFS which are also garnering investor attention this year with positive year to date gains.
- iShares S&P Global Clean Energy Index Fund (ICLN) - gained +8.43%
- ARK Genomic Revolution ETF (ARKG) - risen +12.43%
- ARK Next Generation Internet (ARKW) - higher by +7.41%
While the broader market has turned lower, these above three equity based ETFS appear to be holding their own so far and that's not a trivial achievement. When the
market turns higher eventually these ETFS may continue to show better relative performance if they continue to maintain this relative strength in this correction.
Self-directed investors will, nevertheless, need to be careful and cautious navigating this market which is laden with uncertainty of sorts!
Good Luck and Safe Investing!