Some of S&P’s Favorite Equity ETFs

August 3rd at 6:00am by Tom Lydon

Equity exchange traded funds have proven that they are worth investors assets amid the flight into safe havens such as bonds. The S&P 500 returned 11% throughout 2012, according to S&P Capital.

“Over long periods of time, stocks tend to outperform bonds but with greater risk. According to data from Ibbotson Associates, the inflation-adjusted equity-risk premium, which is the excess return on stocks over inflation, has averaged 6.7% per year over the past 85 years. That handily beat the 2.4% inflation-adjusted return of long-term bonds,” Michael Rawson wrote on Morningstar.

The Federal Reserve meeting and the jobs report due later Friday will have some impact upon the broad market barometer, the S&P 500. Equities and focused ETFs are in positive territory and what happens in the U.S. economy and in the Eurozone will certainly have an impact. [ETF Spotlight: REITs]

Tom Graves, CFA for S&P Capital IQ, reports on some of the better performing equity ETFs. Keep in mind that the past performance is no indication of the future for the following funds. The following ETFs are all rated “Overweight” by S&P Capital IQ and some of the funds had a total return of more than 16% in the last seven months of 2012. [How an Apple Stock Slit Would Impact ETFs]

  • iShares FTSE NAREIT Retail (NYSEArca: RTL
  • Market Vectors  Retail ETF (NYSEArca: RTH)
  • PowerShares KBW Retail Portfolio (NYSEArca: KBWB)
  • PowerShares QQQ (NasdaqGM: QQQ)
  • Technology Select Sector SPDR (NYSEArca: XLK)

The aforementioned ETFs were rated out of a total of 779 equity funds by S&P Capital. Of those, about 130 are classified as U.S. ETFs and 170 received a ranking of Overweight.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.