This year, financial markets experienced a calm that was perhaps never seen before. Volatility readings for equities were at or near record lows throughout 2017, something nobody predicted heading into the scif etf after Trump’s presidential victory.
Encouraged by the lack of risk in the market, investors bid equities higher—much higher. In other words, a lack of volatility doesn’t mean a lack of gains. You could have thrown a dart and made out with a winning ETF. With so many ETFs doing well, the threshold to join the list of top-performing funds is naturally quite high.
There’s only slight overlap between the two lists. 1 and 2 ETFs on the list, the ARK Web x. ARKK holds companies that work in fields related to genomics, next-generation internet and industrial innovation, while ARKW focuses solely on next-generation internet. Aside from ARKW and ARKK, three other ETFs targeting next-generation themes also performed exceptionally well this year. Note: Data measures the total return for the year-to-date period through Dec.
The next group of ETFs to see outstanding gains this year are tied to emerging markets—China and India in particular. Emerging markets broadly have performed well in 2017 thanks to strengthening commodity prices, a more robust global economy and accelerating earnings growth. But ETFs focused on China and India returned two or three times those amounts. China’s economy has grown at an annualized rate of 6. This marks the first time China’s economic growth has accelerated since 2010. Meanwhile, India’s economy experienced a hiccup this year, as a new goods and services tax ate into growth. However, the country remains a darling of emerging markets investors amid expectations growth will reaccelerate thanks to favorable demographics and the pro-business policies of Prime Minister Modi.
Among ETFs, tech-heavy China funds like CXSE and KWEB—which hold major positions in surging stocks like Tencent, Alibaba and Baidu—fared the best. For India ETFs, focusing on small-cap stocks as SCIN and SCIF do worked the best this year. As always, there’s a handful of ETFs that don’t fit any of the broader themes that nonetheless managed to deliver outstanding returns during the year. The surge in homebuilder stocks is especially surprising. The group had its largest annual gain in 15 years due to sector rotation and the promise of tax cuts in 2018, according to J. ITB’s return was fantastic, but add leverage on top of that, and you have the recipe for the top-performing ETF of the year—out of all ETFs.