It’s been a challenging first half of 2020 for investors, but one thing’s for certain—their weapon of choice to combat the coronavirus pandemic woes is the ETF. ETFs could end 2020 with a record year of inflows.
Per a CNBC report, “$200 billion flowed into ETFs in the first half of 2020 despite stocks’ plunge into a bear market and the frequent volatility spikes, according to CFRA Research. That’s enough to put the industry on track for a banner year, Todd Rosenbluth, senior director of ETF and mutual fund research at CFRA, told CNBC’s ‘ETF Edge’ on Monday.”
“If people who found ETFs during the market volatility continue to embrace them, retail and institutional investors, we think we’re going to challenge the record year of a couple of years ago,” Rosenbluth said.
With investors continuing to worry about the coronavirus pandemic, investors can get ETF exposure via low volatility funds to help mute market uncertainty. Here are a few funds to consider:
- Invesco S&P 500 Low Volatility ETF (SPLV): SPLV seeks to invest at least 90% of its total assets in common stocks that comprise the Index. The Index is compiled, maintained, and calculated by Standard and Poor’s and consists of the 100 stocks from the SP 500 Index with the lowest realized volatility over the past 12 months. Volatility is a statistical measurement of the magnitude of up and down asset price fluctuations over time. The Fund and the Index are rebalanced and reconstituted quarterly in February, May, August, and November.
- iShares Edge MSCI Minimum Volatility USA ETF (USMV): USMV seeks the investment results of the MSCI USA Minimum Volatility (USD) Index. The fund will invest at least 90% of its assets in the component securities of the index and may invest up to 10% of its assets in certain futures, options and swap contracts, cash and cash equivalents. The index measures the performance of large and mid-capitalization equity securities listed on stock exchanges in the U.S. that, in the aggregate, have lower volatility relative to the broader U.S. equity market.
- SPDR S&P 500 ETF (NYSEArca: SPY): SPY seeks to provide investment results that, before expenses, correspond generally to the price and yield performance of the S&P 500 Index. The Trust seeks to achieve its investment objective by holding a portfolio of the common stocks that are included in the index, with the weight of each stock in the Portfolio substantially corresponding to the weight of such stock in the index.
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