Sector ETFs Gain Financial Advisors’ Preference

Statistics reveal that financial advisors are starting to prefer sector-focused exchange traded funds (ETFs) over individual stocks. Broad-based ETF assets are down lately due to the state of the market, reports Jesse Emspak for Investor’s Business Daily.

With an inflow of $11.1 billion so far this year, industry-based ETFs haven’t experienced the same losses as the three major indexes and the outflows that have hit broad-based ETFs.

Equity ETFS pale in comparison, with outflows at $18.1 billion year-to-date.

Sector ETFs can be a great way to target a particular industry while protecting yourself from some of the risks in choosing a single stock. Among the top-performing sector funds year-to-date are:

• B2B Internet HOLDRs (BHH), up 26.2% year-to-date
• iShares Dow Jones Transportation Average (IYT), up 18.5% year-to-date
• SPDR S&P Homebuilders (XHB), up 14.4% year-to-date