Three most popular ETF themes of the year

The thematic ETF universe continues to expand with a net new inflow of approximately $ 7.5 billion this year, despite significant exposure to growing companies and a kick in monetary tightening in different parts of the world. Last year, thematic ETFs recorded a net inflow of $ 100 billion, making them one of the preferred investment tools to gain exposure to the themes, trends and megatrends that will shape our future. Thematic ETFs are the solution of choice for thematic investments. With a single transaction, investors can seize investment opportunities on one or more themes that have the potential for long-term capital appreciation.

Disruptive technology, digital infrastructure and connectivity, natural resources, and China’s disruptive technology are one of the most popular topics of the year, raising $ 1.56, $ 1.24, and $ 1.21 billion, respectively. The first theme emerged at the top with investor purchases after tech stocks plunged in the prospect of multiple rate hikes.

Natural resources perform best this year as inflation, global supply chain disruptions, and the recent war between Russia and Ukraine have raised prices for a variety of edible ingredients (such as agriculture) and non-edible materials (such as metals). It is one of the themes. Therefore, the profitability outlook for producers.

Meanwhile, China’s disruptive technology theme has been the target of many bargain hunters, and the stock has witnessed a durable and tragic performance caused by China’s crackdown on various industries.

The ARK Innovation ETF (ARKK), iShares Index Technology ETF (XT), and SPDR S & P Kenshon New Economy Composite ETF (KOMP) are the largest disruptive technology ETFs. Cathie Wood’s ARKK fund was the most popular, with a total net inflow of $ 1.49 billion added to this theme.

SPDR S & P Global Natural Resources ETF (GNR, $ 478 million), FlexShares Morning Star Global Upstream Natural Resources Index Fund (GUNR, $ 430 million), iShares North America Natural Resources for Natural Resources Themed Investors ETFs (IGEs, $ 300 million)) are one of the most popular in 2022. For example, GNR is tracking the S & P Global Natural Resources Index and seeking to invest in companies involved in the natural resources and commodities businesses such as agriculture, energy, metals and mines.

Finally, China’s disruptive technology topics are accessible from the KraneShares CICC China 5G & Semiconductor Index ETF (KFVG), KraneShares SSE STAR Market 50 Index ETF (KSTR), and KraneShares Hang Seng TECH Index ETF (KTEC). Despite being part of a popular theme, the trio’s net outflow totaled $ -19 million.

iShares Digitalization UCITS ETF (DGTL), Lyxor MSCI Disruptive Technology ESG Filtered (DR) UCITS ETF (UNIC), and Lyxor MSCI Digital Economy ESG Filtered (DR) UCITS ETF (EBUY) are the most requested ETFs on disruptive themes. This year’s technology and digital infrastructure, which were three, have raised $ 14 million, $ 18 million, and $ 11 million, respectively.

There are no thematic ETFs on natural resources in Europe. Investors are similar to timber and forestry using iShares Global Timber & Forestry UCITS ETF (WOOD), agribusiness using VanEck Vectors Agribusiness ETF (MOO) or iShares Agribusiness UCITS ETF (SPAG), water using Global X Clean, etc. But you can explore more specific trends. Strategic metal using water UCITSETF (AQWA) or L & G clean water UCITS ETF (XLMC), or VanEck Vectors RareEarth and Strategic MetalsUCITS ETF (REMX).

To access China’s disruptive technology themes, European investors are HSBC Hang Seng TECH UCITS ETF (HSTE), Invesco MSCI China Technology All Shares Stock Connect UCITS ETF (MCTS), and UBS ETF Solactive China Technology UCITS ETF. You can search for (UIC2). Some of the largest funds available in the theme pool.

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