Best performing ETF For 2014: First Trust NYSE Arca Biotech ETF (FBT), SPDR S&P Emerging Asia Pacific (ETF) (GMF), IShares Barclays 20+ Yr. Treas.Bond (ETF) (TLT)
Over the years, investing in bonds and stocks has become easier and easier with focus now shifting to exchange-traded funds that continue to gain traction with the investing community. Bloomberg ’s Eric Balchunas reports that First Trust NYSE Arca Biotech ETF (NYSEARCA:FBT) came in as the best performing ETF for the year having rallied by 50% followed by the likes of IShares Barclays 20+ Yr. Treas.Bond (ETF) (NYSEARCA:TLT) And DBX ETF Trust (NYSEARCA:DBEF).
The rally according to Balchunas did come with a lot of skepticism especially on the valuation of the fund.
“They have always been accused of having high valuation. The past five years this thing has gone up 270%. Biotech is an industry that keeps coming every year, usually winners become losers, losers become winners, but this biotech won’t stop,” said Mr. Balchuna.
The biotech space has remained a buzz of activities this year as investors remain confident that big returns are in the pipeline especially on the ongoing development of new drugs as well as medical sciences. First Trust NYSE Arca Biotech ETF (NYSEARCA:FBT) remains arguably the best-performing ETF for the year at the back of its 20 biotech companies. Balchunas notes that one of the stocks in the funds soared by 400% this year.
SPDR S&P Emerging Asia Pacific (ETF) (NYSEARCA:GMF) came out as the best-performing emerging market ETF with its focus on emerging markets of China, India and Taiwan. Its rally was accelerated by China having a good year economically with Taiwan gaining a great deal from its semiconductor business.
Emerging markets continued to perform well especially on the decline of
oil prices as most of them are oil importing nations. The ETF rallied by 9% against an average decline of 5% for the entire market, garnering $260 million in the process.
IShares Barclays 20+ Yr. Treas.Bond (ETF) (NYSEARCA:TLT) came out on top as the best-fixed income ETF for the year having soared by 24% having accumulated $3 billion dollars in the process.
“The fact that this did so well because it got a high duration of about 21 years proves that nobody really knows anything about the future. If you had listened to an economist or pundit you would not have been in a ticker like this, and it did exceedingly well taking in more money than it has in its entire life,” said Mr. Balchunas
DBX ETF Trust (NYSEARCA:DBEF), on the other hand, came in as the best international ETF having benefited a great deal from the dollar making substantial gains against other currencies. DBEF was up 4% for the year against the industry average that was down by 5% accumulating $1.2 billion in the process.
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