The S&P 500 is sitting on an impressive 16.36% gain with just one day left in the second quarter. Arguably, that's a spectacular run considering the state of U.S. stocks in March at the hands of the coronavirus pandemic.
Of course, some exchange traded funds are rebounding in an even more impressive fashion in the second quarter. The April through June period is proving so kind to equities that nearly 260 U.S.-listed ETFs — approximately 10% of the entire domestic exchange traded products universe — are higher by more than 30% this quarter.
These ETF stars run the gamut of countries, exposures, sectors and themes. The following three are a mix of surprises and reasonable contenders.
Global X MSCI Argentina ETF (ARGT)
It's a great thing if your fund has e-commerce exposure and/or a big weight to Amazon (NASDAQ: AMZN) in 2020.
Amazon's Latin American equivalent – MercadoLibre (NYSE: MELI) – has more than doubled in the quarter.
That's supportive for the Global X MSCI Argentina ETF (NYSEARCA: ARGT) because the oldest Argentina ETF allocates 24% of its weight to MercadoLibre.
How big impactful is MercadoLibre to ARGT's performance? The ETF is trading higher this month, a period in which MSCI put Argentina on the list for possible removal from its emerging markets benchmarks.
ALPS Clean Energy ETF (ACES)
After ranking as one of last year's best-performing ETFs, the ALPS Clean Energy ETF (CBOE: ACES) got off to a hot start this year before succumbing to the COVID-19 blues. One of the hottest stories in the renewable energy ETF space rebounded 34% during the quarter.
Importantly, the second-quarter rally by ACES is rooted in solid fundamentals, including increased alternative energy adoption.
“Although U.S. net generation in April fell 6.6% below the same month in 2019, renewable generation has continued to grow as a source of the nation’s supply and surpassed nuclear and coal for the second month in a row,” reports S&P Global Market Intelligence.
“Renewables accounted for 23.3% of the total, expanding its lead on nuclear generation as the second-largest source of power supply. A nuclear generation made up 21.5% of the nation’s electricity, while gas-fired generation remained the largest supplier of power with a 39.3% share.”
Virtus LifeSci Biotech Clinical Trials ETF (BBC)
Thanks to the coronavirus vaccine competition, which has more than 100 entrants, clinical trials are all the rage these days and the Virtus LifeSci Biotech Clinical Trials ETF (NYSEARCA: BBC) is dedicated to that theme.
As such, BBC is on a tear this quarter with a 43.12% gain. BBC's strategy is interesting as it “passively invests solely in firms with promising drugs in clinical human trials that have not yet been approved by the FDA or gone into production,” according to the issuer.
That's relevant because it could be a year or more before a legitimate vaccine for the virus comes to market. Plus, BBC's components are equally weighted, so single stock risk is limited here.
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