Best & Worst ETFs Of The Week, Amid The Summer Sell-Off

The steep drop in the markets this week was a wake-up call for investors, who might have become accustomed to a sense of complacency in stocks this summer. 

The SPDR S&P 500 ETF SPY fell 1.97 percent on Thursday, amid heavy selling pressure, and followed that up with additional weakness on Friday as well.

The following ETFs represent a sample of the best and worst performing funds over the last five trading sessions:

BEST: Volatility Indexes

Not surprisingly, but this uncharacteristic drop in the markets prompted traders to hedge their positions with aggressive options bets that led to a jump in the CBOE VIX Volatility Index.  As a result, the ProShares VIX Short-Term Futures ETF VIXY jumped more than 15 percent this week. 

VIXY is designed to track near-term VIX futures contracts, which are a measure of expected volatility in the S&P 500.  The fund charges an expense ratio of 0.85 percent, and currently has over $110 million in total assets.

Related: Argentina ETF Drops On Sovereign Default

This ETF is different than other exchange-traded products that invest in volatility futures, because it is backed by tangible assets in a commodity pool rather than being organized as an exchange-traded note. However, this structure does require the issuance of a K-1 for tax reporting purposes.

The iPath S&P 500 VIX Short-Term Futures ETN VXX also moved significantly higher as a result of this jump in volatility. 

WORST: Solar Stocks

Solar energy stocks were one of the hardest-hit sectors of the week, with the Market Vectors Solar Energy ETF KWT falling nearly nine percent.  The fund is now treading water near the flat line for the year in total return as well. 

This ETF tracks 34 global companies engaged in the production, installation and maintenance of solar products.  KWT currently has over $27 million in assets and charges a net expense ratio of 0.66 percent. 

The Guggenheim Solar ETF TAN is s similar ETF in this space, that also endured a significant drop this week.

Both solar and volatility indexes are known for being fast movers, which is why a rebound next week may lead to another big divergence in these high beta sectors.

Market News and Data brought to you by Benzinga APIs
Comments
Loading...
Posted In: Sector ETFsSpecialty ETFsTrading IdeasETFsAlternative EnergyETFssolar industryvolatility indexes
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!