So far it’s been a good year for U.S. equities and, by proxy, the ETFs that track them. The following list of 2019’s best-performing non-leveraged equity ETFs, presented in ascending order, contains some industries you would expect to find on a top 10 list like this, along with some surprises. Performance numbers are through October 15.
10. Invesco Dynamic Building & Construction ETF (PKB) - YTD return of 38.2%
U.S. building and construction companies contained in the fund’s factor-based index are evaluated based on various criteria including price momentum, earnings momentum, quality, management action and value.
9. Pacer Benchmark Data & Infrastructure Real Estate SCTR Strategy (SRVR) - 38.7%
This product from Pacer ETFs aims to offer investors exposure to U.S. companies that generate the majority of their revenue from real estate operations in the data and infrastructure sector. It has a concentrated portfolio of 18 holdings led by data center company Equinix Inc. and two cell tower operators, Crown Castle International Corp. and American Tower Corp.
8. Global X MSCI Greece ETF (GREK) - 39.5%
Remember when Greece’s debt crisis threatened to upend the eurozone? Evidently, investors don’t because this ETF has zoomed this year thanks to investor confidence that the country has been doing what it takes to get its economic house in order. And expectations are high that Kyriakos Mitsotakis, a Harvard-educated former banker and leader of the center-right New Democracy party who became prime minister in July, will follow through on promises to cut red tape and taxes for businesses, as well as boost export-driven sectors.
7. Global X MSCI China Consumer Staples ETF (CHIS) - 39.9%
Global X’s second international ETF on this list invests in large- and mid-capitalization segments of the MSCI China Index that are classified in the consumer staples sector as per the Global Industry Classification System. Companies involved with packaged food products comprise the fund’s largest sector weight at 37% of the portfolio.
6. First Trust Nasdaq Semiconductor ETF (FTXL) - 40.7%
FTXL is based on the Nasdaq US Smart Semiconductor Index, a modified factor-weighted benchmark that selects the 30 most liquid eligible semiconductor securities from the NASDAQ US Benchmark Index and ranks them based on three factors: volatility, value and growth. Its top three positions are Lam Research Corp., Intel Corp. and Applied Materials Inc.
5. iShares PHLX Semiconductor ETF (SOXX) - 42.3%
This fund’s underlying PHLX SOX Semiconductor Sector Index tracks 30 U.S. companies that design, manufacture and distribute semiconductors. The modified market cap-weighted index’s top three holdings are Nvidia Inc., Intel and Texas Instruments Inc.
4. SPDR S&P Semiconductor ETF (XSD) - 43.1%
Based on the equal-weighted S&P Semiconductor Select Industry Index, XSD invests in the semiconductors segment of the broader U.S. equity market. Thanks to market performance, three stocks have inched their way into the top three spots: Nvidia, Skyworks Solutions Inc. and Inphi Corp.
3. VanEck Vectors Semiconductor ETF (SMH) - 43.3%
Yep, you guessed it . . . another semiconductor ETF makes this list in what has been a very good year for this category. SMH tracks the MVIS US Listed Semiconductor 25 Index which, as the name implies, contains 25 U.S.-listed companies involved in semiconductor production and equipment. The top three holdings in this market cap-weighted fund are Taiwan Semiconductor Manufacturing Co. Ltd., Intel and Texas Instruments.
2. iShares U.S. Home Construction ETF (ITB) - 47.1%
While homebuilders in aggregate comprise the fund's largest sector weight (66%), top 10 holdings also include Sherwin Williams, Home Depot Inc. and Lowes Companies Inc.
1. Invesco Solar ETF (TAN) - 59%
Solar stocks—and this ETF that invests in them—have seen lots of clouds during the solar industry’s existence. Indeed, this fund is down roughly 90% since its all-time high shortly after it launched in 2008 during the height of the clean energy bubble that burst during the financial crisis. Regardless, TAN has shined in 2019 thanks to several factors, including falling solar panel prices that have juiced demand among commercial and industrial end users.
