/Market Resilience

Market Resilience

Monday, October 19, 2020 – The stock market oscillated between positive and negative territory this past week as the large-cap benchmarks narrowly squeezed out a third consecutive week of gains. Investors seemed encouraged from a positive U.S. retail sales report that showed consumer spending rose in September despite the lack of renewed aid from Washington. Also, several of the major U.S. banks that kicked off the quarterly earnings season reported strong third-quarter results, boosted by trading and investment banking revenue. Within the S&P 500 Index, industrials and utilities outperformed, while financials recorded minor losses overall. The real estate sector was also weak.

In looking at ETF flows, the Invesco QQQ Trust (QQQ) topped the list, with a total gain of approximately $5.2 billion. The technology heavy fund was a major contributor this week, powering U.S.-listed ETF inflows to $18.5 billion. Also on the top five inflow list was First Trust Capital Strength ETF (FTCS), Vanguard Total Stock Market ETF (VTI), iShares MBS ETF (MBB) and Vanguard Total International Stock ETF (VXUS). In order these ETFs brought in $1.6 billion, $1.4 billion, $1.2 billion and $1.1 billion respectively in net creations. In weekly outflows, we saw iShares MSCI EAFE ETF (EFA) and SPDR Bloomberg Barclays High Yield Bond ETF (JNK) drop over $1 billion and $600 million respectively in redemptions.

ETFG Quant Movers – Those ETFs who have had the largest weekly change in their respective, overall ETFG Quant ratings.

ETFG Quant Winners: The top five gainers in their ETFG Quant Total Score were iPath S&P MLP ETN (IMLP), Innovator IBD ETF Leaders ETF (LDRS), Franklin FTSE Europe Hedged ETF (FLEH), Global X MSCI SuperDividend Emerging Markets ETF (SDEM), and AdvisorShares Vice ETF (ACT). Each ETP added around 10 points to their overall Quant.

ETFG Quant Losers: Honorable mentions in the loser category were ELEMENTS SPECTRUM ETN (EEH), First Trust Preferred Securities and Income ETF (FPE), Schwab Fundamental Emerging Markets Large Company Index ETF (FNDE), iShares MSCI Finland ETF (EFNL) and SPDR Solactive Germany ETF (ZDEU). The reasons for the drop in quant scores can be traced to mostly behavioral factors.

ETFG Weekly Select List – The five most highly rated ETFs per Sector, Geographic Region and Strategy as ranked by the ETFG Quant model.

Considering the sector’s substantial losses, we highlight the top ETFs within the Industrials sector in this week’s Select List. SPDR S&P Transportation ETF (XTN) held on to the 1st position while First Trust RBA American Industrial Renaissance ETF (AIRR) moved from the 4th position to claim 2nd this week.

Those two funds were followed by 3 newcomers which are in order, Invesco Dynamic Building & Construction ETF (PXB), iShares Transportation Average ETF (IYT) and First Trust Industrials/Producer Durables AlphaDEX Fund (FXR).

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Assumptions, opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice.  ETF Global LLC (“ETFG”) and its affiliates and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively ETFG Parties) do not guarantee the accuracy, completeness, adequacy or timeliness of any information, including ratings and rankings and are not responsible for errors and omissions or for the results obtained from the use of such information and ETFG Parties shall have no liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of such information. ETFG PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO ANY WARRANTIES OF MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE.

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This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  Any opinions expressed herein are given in good faith, are subject to change without notice, and are only correct as of the stated date of their issue.  Prices, values, or income from any securities or investments mentioned in this report may fall against the interests of the investor and the investor may get back less than the amount invested.  Where an investment is described as being likely to yield income, please note that the amount of income that the investor will receive from such an investment may fluctuate.  Where an investment or security is denominated in a different currency to the investor’s currency of reference, changes in rates of exchange may have an adverse effect on the value, price or income.

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Assumptions, opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice.  ETF Global LLC (“ETFG”) and its affiliates and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively ETFG Parties) do not guarantee the accuracy, completeness, adequacy or timeliness of any information, including ratings and rankings and are not responsible for errors and omissions or for the results obtained from the use of such information and ETFG Parties shall have no liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of such information. ETFG PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO ANY WARRANTIES OF MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE.  In no event shall ETFG Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs) in connection with any use of the information contained in this document even if advised of the possibility of such damages.

ETFG ratings and rankings are statements of opinion as of the date they are expressed and not statements of fact or recommendations to purchase, hold, or sell any securities or to make any investment decisions. ETFG ratings and rankings should not be relied on when making any investment or other business decision.  ETFG’s opinions and analyses do not address the suitability of any security.  ETFG does not act as a fiduciary or an investment advisor.  While ETFG has obtained information from sources they believe to be reliable, ETFG does not perform an audit or undertake any duty of due diligence or independent verification of any information it receives.

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