Retail ETFs: Looking for a 'Black' Christmas | ETF Trends

Black Friday is coming up fast and all eyes are on retail exchange traded funds (ETFs). Will these be the holiday shopping season that retailers are wishing and hoping for?

Deals are everywhere this holiday season, and retailers are sending out ads for their discounts early. But retailers are finding a different consumer mindset out there.

Sandra M. Jones for The Boston Herald says the American shopper has become more frugal and “deal-sensitive” and retailers are keen to this. Although consumers are flocking to the malls and outlets, experts warn that shoppers aren’t spending as much and often only a good bargain will separate them from their cash. [ETFs for the Holidays.]

Jeff Harding for Minyanville points out that affluent Americans — those with more than $250,000 in investable assets — are feeling more confident about their financial situations than the previous year. They are ultimately the buyers that can drive the economy upward. [‘Tis the Season: Retail ETFs Start Their Engines.]

Reports out this morning indicate that consumer spending and income increased in October, while claims for jobless benefits fell last week.  The Commerce Department reported consumer spending rose by 0.4% in October and incomes grew by 0.5%.

A few points that brighten the retail picture:

  • 41% of affluent Americans feel financially better off today than they did one year ago;
  • More than three out of four (78%) are confident that their financial picture will improve in the year ahead.
  • 61% expect to retire later than originally planned, an increase from 29% in January 2010

Much like retailers themselves, it seems that according to the numbers, ETFs that focus on bargain and value retailers are better positioned to weather the holiday shopping season. A few to check out include:

  • SPDR S&P Retail (NYSEArca: XRT): Holds JC Penney, CarMax,, OfficeMax, Ross and more.
  • Vanguard Consumer Discretionary ETF (NYSEArca: VCR): Holds McDonald’s, Target, Home Depot and Amazon.
  • First Trust Consumer Discretionary AlphaDEX (NYSEArca: FXD): Holds, CarMax, Dollar Tree, Family Dollar and Amazon.

Tisha Guerrero contributed to this article.

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.