Winning ETFs on Record Run in Stocks Under Biden Presidency

·5-min read

President Joe Biden’s first 220 days of ruling has turned out as a blessing for Wall Street, better than any of his forerunners since World War II. Since Election Day, the S&P 500 has jumped 26% through last Friday, representing its best 220-day stretch for stocks, according to investment research firm CFRA, as quoted on a Yahoo Finance article. Only Kennedy administration (with an 18.3% rise in markets in the same timeframe) has come close to Biden’s success.

The rollout of $1.9-trillion of COVID-19 stimulus package — including dolling out of $1,400-stimulus checks, the announcement of $2.3-trillion worth of infrastructure plan, joining of Paris Climate Change agreement in support for a green economy and a massive push for coronavirus vaccination — are some of the measures that Biden resorted to in the first 100 days in office.

Some credit may go to easy comparisons as the stock market crashed in March 2020 due to the onset of coronavirus crisis. As a result, the S&P 500 has been logging solid growth thanks to favorable comparison. Vaccine optimism also started boosting the market mood since the fourth quarter of 2020 on hopes of a sooner-than-expected return to normalcy. Biden’s winning of election, in fact, matched the timeframe of the vaccine rollout.

Meanwhile, more than $5.3 trillion has been shelled out on Covid-related relief efforts, and the Fed’s bond buying program has almost doubled its balance sheet to about $8 trillion. Interest rates have also been at the rock-bottom levels. These measures, along with rapid vaccination (about 3 million Americans per day), boosted consumers’ financial and health security, which in turn reflected on the economic and stock market revival.

Stocks have historically gained 85% of the time on a one-year basis during economic expansionary periods. And going back to 1957, the average bull market in the S&P 500 has continued for 5.8 years, according to Truist Wealth, a wealth management firm, as quoted on the Yahoo Finance article.

The Yahoo Finance article went on to explain thatthe last six months of the first year of a new president’s term is historically considered by steady gains. Since 1945, the S&P 500 has recorded an average gain of 5.1% in that span and has been positive 68% of the time over that stretch, per data from CFRA.

Winning ETFs

Against this backdrop, below we highlight a few ETFs that won greatly in Biden’s ruling. These ETFs have been complete in the past six-month period.

Breakwave Dry Bulk Shipping ETF BDRY – Up 325.1% Past Six Month

The underlying Capesize 5TC Index, Panamax 4TC Index & Supramax 6TC Index measure rates for shipping dry bulk freight. The expense ratio is 3.32% (read: 4 ETF Areas Surged Last Week).

S&P Smallcap Energy Invesco ETF PSCE – Up 79.0% Past Six Month

The underlying S&P SmallCap 600 Capped Energy Index is designed to measure the overall performance of common stocks of US energy companies. The fund charges 29 bps in fees (read: Sector ETFs to Win/Lose as WTI Hovers Around 2018-Level).           

Small-Cap Revenue ETF Oppenheimer RWJ – Up 52.5% Past Six Month

The underlying S&P SmallCap 600 Revenue-Weighted Index is constructed using a rules-based methodology that re-weights the constituent securities of the S&P SmallCap 600 Index according to the revenue earned by the companies in the parent index, subject to a maximum 5% per company weighting. The fund charges 39 bps in fees.  

S&P Retail SPDR XRT – Up 51.6% Past Six Month

The underlying S&P Retail Select Industry Index represents the retail sub-industry portion of the S&P TMI. The S&P TMI tracks all the U.S. common stocks listed on the NYSE, AMEX, NASDAQ National Market and NASDAQ Small Cap exchanges. The Retail Index is a modified equal weight index. The fund charges 35 bps in fees (read: ETFs to Buy on Strong 2021 Retail Sales Outlook).

Global X Uranium ETF URA – Up 50% Past Six Month

This ETF provides access to a broad range of companies involved in uranium mining and the production of nuclear components, including those in extraction, refining, exploration, or manufacturing of equipment for the uranium and nuclear industries. The fund charges 69 bps in annual fees.         

Cambria Shareholder Yield ETF SYLD – Up 49.1% Past Six Month

This ETF is active and does not track a benchmark. The Cambria Shareholder Yield ETF utilizes a quantitative approach to invest in US equities with high cash distribution characteristics. The ETF is comprised of the 100 companies with the best combined rank of dividend payments and net stock buybacks, which are the key components of shareholder yield. It charges 59 bps in fees.

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SPDR S&P Retail ETF (XRT): ETF Research Reports
 
Invesco S&P SmallCap Energy ETF (PSCE): ETF Research Reports
 
Cambria Shareholder Yield ETF (SYLD): ETF Research Reports
 
Invesco S&P SmallCap 600 Revenue ETF (RWJ): ETF Research Reports
 
Global X Uranium ETF (URA): ETF Research Reports
 
Breakwave Dry Bulk Shipping ETF (BDRY): ETF Research Reports
 
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