The Amplify Online Retail ETF IBUY recently turned two years old and celebrated the milestone in style. As of April 30, IBUY — the first exchange traded fund dedicated to e-commerce and online retail stocks — had $306.62 million in assets under management, according to issuer data.
IBUY tracks the EQM Online Retail Index, which requires that member firms generate at least 70 percent of their sales from online venues.
What Happened
IBUY debuted April 20, 2016; it was good timing for the ETF, as it debuted at a time when markets were pricing elevated concerns about the future of the brick-and-mortar retail model. Since IBUY came to market, several well-known brick-and-mortar retailers have gone out of business, while scores of others have continuously highlighted weakness in their various operating segments.
IBUY “has returned 52.61 percent in the past year, and a cumulative return of 80.32 percent since inception as of March 31, 2018,” according to a statement from Amplify.
Over the past 24 months, IBUY is up 82.7 percent while the largest retail ETF is higher by just 3.9 percent. IBUY has also been less volatile than its traditional rival, the SPDR S&P Retail ETF XRT.
Why It's Important
IBUY is the first ETF dedicated to online retailing, and first mover advantage in the ETF world is distinct. IBUY is a credible growth play because online retail sales still command just 10 percent or so of total U.S. retail sales.
Top 10 holdings in the ETF include GrubHub Inc. GRUB, Netflix, Inc.NFLX and Amazon.com Inc. AMZN. IBUY's roster is comprised of 39 stocks. Member firms consist of marketplace, travel and merchant names.
What's Next
“With online retail still less than 10 percent of overall U.S. retail sales, IBUY remains an attractive opportunity for investors to capitalize on this digital mega-trend,” said Christian Magoon, founder and CEO of Amplify ETFs.
Year-to-date, IBUY is continuing its drubbing of traditional retail ETFs. IBUY is up 9.8 percent while XRT is higher by just 0.3 percent.
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