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New Data Supports Online Retail ETFs

This article was originally published on ETFTrends.com.

The Global X E-commerce ETF (EBIZ) and other ETFs emphasizing e-commerce and online retail were boosted Monday by the latest batch of data supporting the notion that retail sales are increasingly becoming a digital affair.

EBIZ tries to reflect the performance of the Solactive E-commerce Index, which include companies that are positioned to benefit from the increased adoption of e-commerce as a distribution model, including but not limited to companies whose principal business is in operating e-commerce platforms, providing e-commerce software and services, and/or selling goods and services online, according to the fund’s prospectus.

In a note out Monday, the Commerce Department said online retail sales increased 4.2% in the second quarter from the first three months of the year.

“Total retail sales for the second quarter of 2019 were estimated at $1,361.8 billion, an increase of 1.8 percent(±0.2%)from the first quarter of 2019,” according to the Commerce Department. “The second quarter 2019 e-commerce estimate increased 13.3 percent (±1.6%) from the second quarter of 2018 while total retail sales increased 3.2 percent(±0.5%) in the same period. E-commerce sales in the second quarter of 2019 accounted for 10.7 percent of total sales.”

All About Online

Online shopping is now the second-biggest component of the U.S. retail market after overtaking grocery stores and restaurants. Investors can also focus on this quickly growing segment through targeted ETF strategies.

Shopping and consumer trends are changing as more buyers rely on the convenience of online retailers to quickly and easily meet their discretionary needs. As the retail landscape changes, investors can also capitalize on the trend through ETFs that target the e-commerce segment.

Related: Demographic Trends Favor EBIZ E-Commerce ETF 

“On a not adjusted basis, the estimate of U.S. retail e-commerce sales for the second quarter of 2019 totaled $139.7 billion, an increase of 8.3 percent(±0.9%) from the first quarter of 2019,” according to the Commerce Department. “The second quarter 2019 e-commerce estimate increased 13.6 percent (±1.6%) from the second quarter of 2018 while total retail sales increased 3.4 percent (±0.5%) in the same period. E-commerce sales in the second quarter of 2019 accounted for 10.1 percent of total sales.”

EBIZ is up almost 26% year-to-date.

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