The pandemic may have upended many jobs in America, but certain subsectors of the financial services industry are thriving. Take insurance for example—this gives exchange-traded fund (ETF) investors the opportunity to look at insurance-focused funds.
“Amid this environment, jobs in the financial sector have proven to be more secure. BLS revealed that the ‘financial activities’ industry lost 262,000 jobs for the month of April, putting it in the bottom four industries on its list of job-losing sectors. In the insurance sector specifically, the unemployment rate has crept up from 1% in February to 3.9% in April – compared to 14.7% for the country as a whole,” wrote Alicja Grzadkowska in an Insurance Business America article.
“In fact, the insurance sector has often been touted as ‘recession-proof’ and jobs within it as ones that offer stability, since people and businesses need insurance whether the economy is doing well or not,” the article added. ‘While the current crisis is unprecedented in many ways, including in its impact on global financial markets, and the long-term effects of this pandemic are yet to be determined, it’s safe to say that, at least for now, insurance is a safer space to work in than say, hospitality, travel, and tourism or retail.”
Here are a few ETFs in insurance to help insure investors’ portfolios ahead:
iShares U.S. Insurance ETF (IAK): seeks to track the investment results of the Dow Jones U.S. Select Insurance Index composed of U.S. equities in the insurance sector. The fund generally invests at least 90% of its assets in securities of the underlying index and in depositary receipts representing securities of the underlying index. The underlying index measures the performance of the insurance sector of the U.S. equity market.
SPDR S&P Insurance ETF (KIE): seeks to provide investment results that, before fees and expenses, correspond generally to the total return performance of an index that tracks the performance of publicly-traded companies in the insurance industry. In seeking to track the performance of the S&P Insurance Select Industry Index (the “index”), the fund employs a sampling strategy. It generally invests substantially all, but at least 80%, of its total assets in the securities comprising the index. The index represents the insurance segment of the S&P Total Market Index (“S&P TMI”).
Invesco KBW Property & Casualty Insurance ETF (KBWP): seeks to track the investment results (before fees and expenses) of the KBW Nasdaq Property & Casualty Index (the “underlying index”). The fund generally will invest at least 90% of its total assets in the securities that comprise the underlying index. The underlying index is a modified market capitalization-weighted index of companies primarily engaged in U.S. property and casualty insurance activities, as determined by the index provider.
For more market trends, visit ETF Trends.