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
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.