This year's ETF highlights the huge disparity in performance across different segments of the market, with one sector dominating the list of top performers.
Given the outperformance of oil and natural gas assets and significant losses in other sectors, many of the best performing funds are commodity strategies and inverse leveraged ETFs. In many cases, energy ETFs didn't even need leverage to outperform, and general sector ETFs saw huge gains.
However, when you strip out the leveraged ETFs, there are some surprising names at the top breaking the oil and gas ETF monopoly.
* Leveraged versions of inverse ETFs and other strategies are not included in the table. Return data as of 12/23. The
iShares MSCI Turkey ETF (TUR) rallied in the second half of the year with a total return of over 100%. That actually puts it ahead of , the unleveraged energy fund, according to FactSet.
Sky high inflation and the political influence of the country's central bank make investing in Turkey a tricky proposition for investors, but that turns in 2022.
Even with the outlier Turkey ETF, the list as a whole is dominated by oil and gas funds, with the VanEck Oil Services ETF (OIH) delivering a total return of 65%. As of Dec. 23, seven other energy-related funds had a total return of more than 60%.
Removing all energy ETFs, the remaining list shows more innovative strategies succeeding.
* Inverse ETFs and leveraged ETFs are not included in the list. Return data as of 12/23. The second best performing fund on the
list is the Simplify Interest Rate Hedged ETF (PFIX). The fund was one of the few funds to stand out in a year with the highest inflation in decades and a Fed multiple rate hikes . The Advocate Rising Rate Hedge ETF (RRH) and FolioBeyond Rising Rates ETF (RISR) also did their part, breathing life into investors' portfolios. The
KFA Mount Lucas Managed Futures Index Strategy ETF (KMLM) gained more than 30%, also pointing to 2022 trends. Some managed futures funds have thrived in recent years, as active management of directional bets in market sectors like technology and energy has proven to have a big market.
In terms of inflows, Vanguard and iShares broad market funds are the big winners as these two brands continue to dominate the ETF market.
But some smaller funds this year have seen big inflows such as the SPDR Bloomberg 1-3 Month Treasury Bond ETF (BIL), JPMorgan Chase Equity Premium Income ETF (JEPI) and the WisdomTree Floating Rate Treasury Bond Fund (USFR), Especially relative to their size.
This article comes from the financial world
