6 ETFs to Consider as Thanksgiving Week Begins

Sweta Jaiswal, FRM
·5-min read

The U.S. holiday season, which lasts from October to December, is the most exciting times for business houses due to high sales numbers. Although this year has been rough because of the coronavirus crisis, holiday shoppers are still expected to keep splurging.

Online is expected to be a major mode of shopping amid the outbreak. Also, with limitations on some outdoor entertainment options like theme parks, amusement parks, travels or sports tickets, people are likely to gift or buy more modes of in-house entertainment.

Considering Thanksgiving celebrations along with the major retail event, Black Friday, this week is going to be under the radar of market participants who wish to tap the holiday shopping momentum. According to Deloitte’s report on holiday spending forecasts, retail sales may see growth of 1-1.5% during the November-January period, per a CNBC article. It comes to $1.147-$1.152 trillion based on the 2019 sales level of $1.14 trillion, per the same report.

ETFs to Watch Out For This Week

Against this backdrop, we look at some ETFs that are expected to benefit from consumer shopping and celebrations as the Thanksgiving week begins:

U.S. Global Jets ETF JETS

Despite the aggravating coronavirus outbreak, we expect increasing number of Americans to travel this Thanksgiving. In fact, going by The Washington Post article, airports from Arizona to Illinois were very busy over the weekend. The report also mentions that more than 2 million travelers passed through TSA checkpoints on Nov 20 and 21 that turned out to be the busiest two-day stretch since March. An article by The Guardian mentions that around 50 million people are projected to travel by various modes during the Thanksgiving week to celebrate it with family and loved ones.

The fund provides investors access to the global airline industry, including airline operators and manufacturers from all over the world. The fund has an expense ratio of 0.60% (read: ETF Strategies to Play as Vaccine Hopes Firm With Moderna Data).

Amplify Online Retail ETF IBUY

The pandemic has been supporting the e-commerce industry as people continue to practice social distancing and shop online for all essentials, especially food items. Thus, on par with the digitization trend, the upcoming U.S. holiday season is expected to see a significant surge in online sales. Going by research and advisory firm, Forrester, U.S. online holiday sales are expected to hit $173 billion this year, suggesting growth of 24% year over year from $139 million.

seeks to provide investment results that, before fees and expenses, correspond generally to the price performance of the EQM Online Retail Index. The index is a globally-diverse basket of publicly-traded companies that obtain 70% or more of revenue from online or virtual sales. The fund has an expense ratio of 0.65% (read: COVID-19 Cases on the Rise: ETFs to Bet On).

Vanguard Consumer Discretionary ETF VCR

There has been improvement in consumer spending and confidence after the pandemic-induced record decline in March.As restrictions were being relaxed in the United States, a number of restaurants and retailers started resuming business during the post-lockdown period. Even during the holiday season, the sector is expected to see a boost in sales and demand as it attracts a major portion of consumer spending.

The fund seeks to track the performance of a benchmark index that measures the investment return of stocks in the consumer discretionary sector. It has an expense ratio of 0.10% (read: Sector ETFs & Stocks to Buy This November).

ETFMG Prime Mobile Payments ETF IPAY

Along with increased interest in online shopping, customers are resorting to digital payments to clear bills. At the same time, merchants and utility providers are increasingly advocating the same.

The fund capitalizes on the shift from credit card and cash transactions to digital and electronic systems. It benefits from the growing use of smartphones, ecommerce and the need for disturbance free transacting.It has an expense ratio of 0.75% (read: PayPal Q3 Earnings Impress Investors: ETFs to Win).

iShares Transportation Average ETF IYT

This holiday season appears to be a comparatively strong period for retailers. Moreover, the growing inclination toward ecommerce has resulted in a wider reach for players in the retail space. That’s why there should be a surge in demand for freight services to deliver the products ordered online.

The fund provides exposure to U.S. airline, railroad, and trucking companies. The fund has an expense ratio of 0.42% (read: Why Cyclical Sector ETFs Are Roaring to All-Time Highs).

VanEck Vectors Video Gaming and eSports ETF ESPO

Amid the health crisis, adults and kids are looking for some indoor fun activities, which is resulting in a boom in the video game industry. Highlighting this fact, the latest report from The NPD Group predicts that consumer spending on video games in the United States may touch $13.4 billion this holiday season (November and December 2020), surging 24% year over year. Additionally, the upside is largely expected to be led by the sale of console hardware, headsets, gamepads, mobile, digital full-game and post-launch content on console and PC, and subscription.

The fund seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the MVIS Global Video Gaming and eSports Index. It has an expense ratio of 0.55% (read: Nvidia Q3 Earnings and Revenues Top: ETFs to Buy).

Want key ETF info delivered straight to your inbox?

Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>


Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
 
iShares Transportation Average ETF (IYT): ETF Research Reports
 
Vanguard Consumer Discretionary ETF (VCR): ETF Research Reports
 
U.S. Global Jets ETF (JETS): ETF Research Reports
 
Amplify Online Retail ETF (IBUY): ETF Research Reports
 
ETFMG Prime Mobile Payments ETF (IPAY): ETF Research Reports
 
VanEck Vectors Video Gaming and eSports ETF (ESPO): ETF Research Reports
 
To read this article on Zacks.com click here.
 
Zacks Investment Research
 
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report