As Americans prepare for Thanksgiving Day, let’s explore the bounty that the investment world holds on this occasion. This can be easily done by screening ETFs that have rewarded investors this year.
How is the Stock Market Faring?
After a blockbuster start to 2018, the American stock market is caught in a vicious circle of volatility and uncertainty. It started with growing inflationary threats, the surge in yields, tech selloff, and anti-trade Trump policies in the first half of the year that continued in the second half even with more hurdles. Some of the notable ones were a political malaise in Europe, escalation in U.S.-China trade war, troubles in emerging market and threats of a global slowdown. Additionally, oil price crashed last week and slipped into a bear territory.
As such, both the S&P 500 and Dow Jones wiped out all the gains and were pushed slightly into the red from a year-to-date look.
However, a slew of strong earnings and rounds of upbeat economic data have been the major catalysts to stocks. This is especially true as the American economy has been on a solid pace of growth with robust job creation, strong GDP growth, a 50-year low unemployment rate, the fastest pace of wage gains in nearly a decade, and rising consumer and business confidence. While third-quarter GDP growth slowed to 3.5% from 4.2% in the second quarter amid mounting headwinds from a trade, it marks the best two-quarter stretch in four years. With this, the economy is on pace for the fastest annual growth in 13 years.
That said, a few corners are easily crushing the broader market in the year-to-date period. Below we have highlighted five ETFs that have been star performers so far this year and could be better plays in the coming months. These ETFs deserve special thanks and attention going into the New Year too.
Invesco S&P SmallCap Health Care ETF (PSCH – Free Report) – Up 22.5%
This ETF got a boost from the dual tailwinds of its sector’s non-cyclical nature and its small-cap focus. Small-cap stocks are well insulated from headwinds as we are currently seeing. These stocks are considered safe and better plays if any political issue or economic turmoil creeps into the picture. Additionally, encouraging sector fundamentals, tax reform, rising M&A activities and a positive regulatory backdrop added to the strength.
