Investors and Wall Street analysts have been paying close attention to the struggles of traditional brick-and-mortar names, particularly department stores.
Some recent data indicate rising credit defaults among traditional retailers, a theme that could weigh on standard exchange traded funds.
Fortunately, the ETF universe’s evolution reflects changing trends in retail, a theme embodied by the Amplify Online Retail ETF (NasdaqGM: IBUY), which debuted last year. IBUY, which is comprised of global companies that generate at least 70% of revenue from online or virtual sales, has been one of the best-performing retail ETFs since its inception.
In fact, IBUY’s gain of nearly 12% since coming to market puts it well ahead of the returns offered by the largest legacy retail ETF over the same period.
“While online sales are skyrocketing, traditional retail is hitting the bricks (literally). Over the holidays, online sales generated $91b, an increase of 11% from one year ago, with a staggering $1b in sales generated per day between Nov 1 and Dec 31. Meanwhile, mall sales declined 9.9% in November and December. Macy’s (NYSE:M) experienced a 2.7% dip in sales, Kohl’s (NYSE:KSS) saw a 2.1% drop in sales, and Sears (NASDAQ:SHLD) also had troubles with 12% decline in sales,” according to Seeking Alpha.