Here is a look at ETFs that currently offer attractive short buying opportunities.
The ETFs included in this list are rated as buy candidates for two reasons. First, each of these funds is deemed to be in an uptrend based on the fact that its 50-day moving average is above its 200-day moving average, which are popular indicators for gauging medium-term and long-term trends, respectively.
Second, each of these ETFs is also trading below its 20-day moving average, thereby offering a near-term “buy on the dip” opportunity given the longer-term uptrend at hand. Note that this list also features a liquidity screen by excluding ETFs with average trading volumes below the one million shares mark. As always, investors of all experience levels are advised to use stop-loss orders and practice disciplined profit-taking techniques.
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Only 58 ETFs made it to the list of buy on the dip prospects this month. The three U.S. indices closed higher this month supported by a drop in jobless claims and positive manufacturing data. Several silver ETFs like ProShares Ultra Silver (AGQ A-), Aberdeen Standard Physical Silver Shares ETF (SIVR B), and iShares Silver Trust (SLV C+) featured on this month’s buy on the dip prospects’ list as silver prices consolidated in a recent short term pullback. Many gold ETFs such as VanEck Vectors Gold Miners ETF (GDX B+), iShares Gold Trust (IAU A) and SPDR Gold Shares (GLD A-) also ranked amongst the buy on the dip candidates since gold prices declined by more than 4% in the last month. Hopes of economic recovery on positive economic data from the U.S. also made the precious metal less attractive. Biotechnology stocks such as SPDR S&P Biotech ETF (XBI B-) and iShares Nasdaq Biotechnology ETF (IBB B+) were also present in this month’s buy on the dip prospects list as the biotechnology sector declined by more than 3% during the month. The index had run up quickly in a very short period of time, hence a pullback. Compare and contrast the two biotechnology ETFs using our ETF Comparison tool._ Health Care Select Sector SPDR Fund (XLV A) also featured on the list as the healthcare sector posted a decline of 0.22% for the month. iShares U.S. Home Construction ETF (ITB A-) and SPDR S&P Homebuilders ETF (XHB A+) also made it to the list of buy on the dip prospects as new home construction declined marking the largest monthly fall in nearly past three decades, as a result of the COVID-19 impact. Several short-term government bond ETFs like Vanguard Short-Term Government Bond ETF (VGSH A), iShares 1-3 Year Treasury Bond ETF (SHY A) and Schwab Short-Term U.S. Treasury ETF (SCHO A) also made it to the list of buy on the dip prospects after yields hit 0.149% increasing from 0.13% in the last month. Many emerging market ETFs like iShares MSCI Emerging Markets ETF (EEM A-), iShares Core MSCI Emerging Markets ETF (IEMG A) and SPDR Portfolio Emerging Markets ETF (SPEM) were buy on the dip candidates this month as the rate of infections continues to rise in certain emerging economies leading to severe economic impacts.
To compare this month’s list with the one published on August 12, click here.
ETFs to Buy on the Dip
iShares Global Clean Energy ETF
ProShares Ultra Silver
Aberdeen Standard Physical Silver Shares ETF
iShares Silver Trust
VanEck Vectors Gold Miners ETF
SPDR S&P Biotech ETF
Sprott Physical Silver Trust
iShares U.S. Home Construction ETF
SPDR S&P Retail ETF
iShares Nasdaq Biotechnology ETF
Sprott Physical Gold and Silver Trust
iShares MSCI Taiwan ETF
SPDR S&P Homebuilders ETF
SPDR Gold MiniShares Trust
Aberdeen Standard Physical Swiss Gold Shares ETF
iShares Gold Trust
SPDR Gold Shares
Sprott Physical Gold Trust
iShares MSCI All Country Asia ex Japan ETF
iShares MSCI South Korea ETF
Health Care Select Sector SPDR Fund
iShares China Large-Cap ETF
iShares MSCI Emerging Markets ETF
iShares Core MSCI Emerging Markets ETF
SPDR Portfolio Emerging Markets ETF
Schwab Emerging Markets Equity ETF
iShares MSCI Japan ETF
iShares Russell Mid-Cap ETF
iShares MSCI EAFE Small-Cap ETF
Vanguard FTSE All-World ex-US ETF
Vanguard Total International Stock ETF
iShares Core MSCI Total International Stock ETF
iShares Russell 2000 ETF
SPDR EURO STOXX 50 ETF
SPDR Portfolio Developed World ex-US ETF
Vanguard FTSE Developed Markets ETF
iShares MSCI Eurozone ETF
Direxion Daily FTSE China Bull 3X Shares
Schwab International Equity ETF
iShares Core MSCI EAFE ETF
Vanguard FTSE Europe ETF
Vanguard Short-Term Bond ETF
iShares Core S&P Mid-Cap ETF
iShares MSCI EAFE ETF
iShares MBS ETF
SPDR Portfolio Short Term Treasury ETF
iShares 1-3 Year Treasury Bond ETF
Vanguard Short-Term Government Bond ETF
Schwab Short-Term U.S. Treasury ETF
iShares MSCI Canada ETF
iShares National Muni Bond ETF
iShares Core S&P Small-Cap ETF
iShares iBoxx $ High Yield Corporate Bond ETF
SPDR S&P Metals & Mining ETF
SPDR Bloomberg Barclays High Yield Bond ETF
iShares U.S. Preferred Stock ETF
SPDR Bloomberg Barclays Short Term High Yield Bond ETF
iShares MSCI Australia ETF
Please note that this list is updated on a monthly basis.
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Disclosure: No positions at time of writing.