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After the worst third-quarter performance in four years, the U.S. stock market showed an impressive comeback to start the new quarter, trumping global growth worries. This is especially true as the S&P 500 index and Dow Jones climbed 7.1% and 6.7%, respectively, in the first few days of the final quarter of 2015. The rally has been broad-based with most of the sectors moving up on subsiding volatility and none of the issues from Q3 currently overwhelming the market. In particular, the rising oil price has fueled optimism into the battered energy sector and a rebound is noticeable in the beaten-down healthcare stocks. Further, China, the major culprit of the market turmoil, is showing signs of stabilization and commodities are surging too. Moreover, the dismal job report for September and the latest Fed minutes suggest that cheap money flows will be in place for longer than expected. This seems good for the stocks as the near-zero rates have allowed the U.S. stock market to complete a spectacular six-year bull-run. If these weren’t enough, the final three months have been the strongest and extremely profitable for investors, if history is any guide. Since 1995, the S&P 500 posted an average gain of 5% , representing the best quarterly return. This is especially true as seasonality drives the stock market higher during this time period given the crucial holiday shopping season and an expected Santa Claus Rally. Though there have been winners in every corner of the space, several ETFs have easily crushed the broad market fund (NYSEARCA: SPY ) by wide margins. Below, we have highlighted five ETFs have been star performers since the start of the fourth quarter and look to offer a broad exposure across a number of sectors. PowerShares S&P 500 High Beta Portfolio (NYSEARCA: SPHB ) This fund tracks the performance of 100 stocks from the S&P 500 Index with the highest realized volatility over the past 12 months. It follows the S&P 500 High Beta Index and has amassed $78.4 million in its asset base. The ETF trades in good volume of more than 132,000 shares a day and charges 0.25% in expense ratio. The product is widely spread out across each security as none of these holds more than 1.75% of total assets. Mid-caps account for 51% of the portfolio, while large caps comprise the remaining. Small caps get just 2%. From a sector look, energy takes the top spot with one-fourth share, closely followed by information technology (18.6%), industrials (16.8%) and consumer discretionary (12.9%). SPHB had a strong run this quarter, gaining near double digits. PowerShares Russell 2000 Equal Weight Portfolio ( EQWS ) This fund provides equal-weight exposure to the small-cap segment of the broad U.S. stock market. It tracks the Russell 2000 Equal Weight Index, holding 1,928 stocks in the basket with each holding less than 0.3% of assets. The product is also widely spread across a number of sectors with industrials, information technology, energy, consumer discretionary and consumer staples taking double-digit allocation each. The ETF is often overlooked by investors as depicted by AUM of $13.5 million and average daily volume of under 1,000 shares. It charges 27 bps in fees per year from investors. The fund gained about 9.7% since the start of the fourth quarter and has a Zacks ETF Rank of 3 or ‘Hold’ rating with a High risk outlook. Guggenheim S&P SmallCap 600 Pure Value ETF (NYSEARCA: RZV ) This fund provides pure exposure to the small-cap value segment of the U.S. equity market by tracking the S&P SmallCap 600 Pure Value Index. It holds 157 stocks in its basket that are widely spread across components with none holding more than 2.0% of total assets. From a sector look, about one-fourth of the portfolio is tilted toward the top sector – industrials – while information technology, consumer discretionary, financials and energy round off the top five. The product has been able to manage $154.7 million in its asset base while trading in a paltry volume of about 14,000 shares a day on average. It charges 35 bps in fees per year from investors and added about 9.5% in the first few trading sessions of the fourth quarter. RZV currently has a Zacks ETF Rank of 3 with a High risk outlook. Direxion Value Line Mid- and Large-Cap High Dividend ETF (NYSEARCA: VLML ) This fund uses a unique strategy to provide investors exposure to the mid and large-cap stocks that are expected to pay above-average dividends. This is easily done by tracking the Value Line Mid- and Large-Cap High Dividend Yield Index, which selects stocks based on the criteria of the four-part Value Line, namely, Timeliness, Performance, Safety Ranks and the Financial Strength Rating. This approach results in a basket of 51 securities, with Archer-Daniels-Midland (NYSE: ADM ), Air Products & Chemicals (NYSE: APD ) and Avery Dennison (NYSE: AVY ) as the top three holdings. The fund is well spread across various sectors with double-digit exposure to industrials, materials, consumer discretionary, technology, financials and energy. It was introduced to the space in March and has accumulated about $4.8 million in AUM. Volume is paltry at about 300 shares a day while expense ratio came in a bit higher at 0.38%, suggesting an extra hidden cost for this fund. VLML is up 9.3% so far this quarter. First Trust Mid Cap Value AlphaDEX Fund (NYSEARCA: FNK ) This product offers exposure to the mid cap value sector of the U.S. equity market and employs the AlphaDEX stock selection methodology to select stocks from the S&P MidCap 400 Value Index. Holding 183 stocks in its basket, the fund provides a nice balance across each sector and securities, preventing heavy concentration. Industrials make up for the top sector at roughly 17.2% share while none of the securities hold more than 1.20% share in the basket. The ETF is relatively unpopular and illiquid in the mid cap space with AUM of $70.4 million and average daily volume of 13,000 shares. It charges a higher 73 bps in annual fees and has gained 8.8% in the same time frame. It has a Zacks ETF Rank of 3 with a Medium risk outlook. Bottom Line Investors should definitely look at these ETFs as these could continue their strong performances heading into the fourth quarter and lead the broad market rally. Original post . Scalper1 News
Scalper1 News