Favorable data for online retailers continues piling up, indicating the Global X E-commerce ETF (NasdaqGM: EBIZ) is one of the thematic ETFs investors should be considering in the current market climate.
EBIZ reflects the performance of the Solactive eCommerce Index and looks to invest in companies positioned to benefit from the increased adoption of E-commerce as a distribution model, including companies whose principal business is in operating eCommerce platforms, providing eCommerce software and services, and/or selling goods and services online.
A report out Tuesday from the Commerce Department said online retail sales surged 31.8% year-over-year in the second quarter and that e-commerce accounted for 13.1% of all U.S. retail sales during the April through June period.
“The Census Bureau of the Department of Commerce announced today that the estimate of U.S. retail e-commerce sales for the second quarter of 2020, adjusted for seasonal variation, but not for, was $211.5billion, an increase of 31.8percent(±1.2%) from the first quarter of 2020,” according to the report.
EBIZ Right Place, Right Time
Shopping and consumer trends are changing as more buyers rely on the convenience of online retailers to quickly and easily meet their discretionary needs. As the retail landscape changes, investors can also capitalize on the trend through ETFs that target the e-commerce segment. Demographic trends are driving those shifts.
Adding to the case for EBIZ, some market observers believe changes in consumers’ behavior, which were apparent before the virus, are merely being hastened by the COVID-19 pandemic and that online is where it’s at for retailers – a theme that’s expected to be sticky for years to come.
“On a not adjusted basis, the estimate of U.S. retail e-commerce sales for the second quarter of 2020totaled $200.7billion, an increase of 37.0percent(±1.2%) from the first quarter of 2020. The second quarter 2020e-commerce estimate increased44.4percent (±1.9%) from the second quarter of 2019while total retail sales decreased3.4percent (±0.5%) in the same period. E-commerce sales in the second quarter of 2020accounted for 15.1percent of total sales,” according to the Commerce Department.
Shopping and consumer trends are changing as more buyers rely on the convenience of online retailers to quickly and easily meet their discretionary needs. As the retail landscape changes, investors can also capitalize on the trend through ETFs that target the e-commerce segment. Demographic trends are driving those shifts.
EBIZ is higher by 55% year-to-date and hit a record high on Tuesday.
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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.