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Defensive ETFs to Tackle Weak Job Data, North Korea Tensions

NantHealth, Inc. (NH) delivered earnings and revenue surprises of 23.08% and -10.83%, respectively, for the quarter ended September 2018. Do the numbers hold clues to what lies ahead for the stock?

September opened up with a deluge of mixed data points for the U.S. economy. Job data for the month of August disappointed investors, though manufacturing data came in upbeat. The U.S. economy created 156,000 jobs in August, falling shy of economists’ expectation of 180,000 job additions.

Not only was August job data less than expected, job totals also were reduced from 231,000 to 210,000 for June and 209,000 to 189,000 for July, as per an article published on CNBC.

Added to this domestic tension, North Korea is bothering the global economic buoyancy and upbeat market momentum. North Korea’s relentless launch of missiles and hydrogen-bomb tests make it a global threat and sparked off geopolitics.

The U.S. State Department's recent ban on the country’s passport holders’ travel to North Korea gives such cues. Not only this, Trump indicates cutting trade ties with countries that are allies with North Korea (read: Low Volatility ETFs to Buy If North Korea Tensions Flare Up).

Needless to say, such confusion brightened the appeal for gold ETFs. Gold prices jumped on Monday to “their highest in close to a year” as investors flocked to safe-haven assets following North Korea’s sixth and largest nuclear test, as per Reuters. SPDR Gold Trust GLD is up for gains in the coming days.

Plus, U.S. Treasury ETFs should be hogging attention for the safety these offer. iShares 20+ Year Treasury Bond ETF TLT is likely to deliver profits in the coming days as geopolitics escalated and chances of the next Fed rate hike this year have ebbed substantially following downbeat job data (read: 5 Alternative ETFs to Beat Market Slump).

Investors spooked by such concerns may very well play defensive ETFs in the coming days. Below we highlight some:

PowerShares Russell Low Beta Equal Weight Portfolio USLB

This fund seeks to track the performance of the Russell 1000 Low Beta Equal Weight Index, holding 375 stocks exhibiting low beta characteristics. It is widely diversified across components with each security accounting for less than 0.37% of total assets. Consumer Discretionary, Information Technology and Real Estate are the top sectors of the fund.

U.S Market Neutral Anti-Beta Fund BTAL

Investors who want to shift their focus to investing in low beta stocks during this uncertain market environment can consider adding BTAL ETF to their portfolio. This fund follows the Dow Jones U.S. Thematic Market Neutral Anti-Beta Index which is an equal-weighted, dollar-neutral, sector-neutral benchmark. The index identifies the lowest beta stocks and goes long on them, while at the same time goes short on the highest beta stocks.

YieldShares High Income ETF YYY

This fund yields about 8.73% annually. It holds 30 closed-end funds ranked the highest by the ISE on the basis of three criteria namely fund yield, discount to net asset value and liquidity. Around 75% of the fund is targeted at debt securities while the rest are in equities (read: High Income ETFs Worth Their High Costs).

The Legg Mason Low Volatility High Dividend ETF LVHD

This ETF provides stable income through investment in stocks of profitable U.S. companies with relatively high dividend yields, lower price and earnings volatility. Utilities, consumer staples, and industrials make up the top three sectors with a double-digit allocation each. The 30-Day SEC yield of the fund was 3.59% as of Jun 30, 2017 (read: Time to Buy Global Low Volatility ETFs?).

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YLD SHS-HI INC (YYY): ETF Research Reports
ISHARS-20+YTB (TLT): ETF Research Reports
GOLD (LONDON P (GLD): ETF Research Reports
LM-LO VOL HIDIV (LVHD): ETF Research Reports
QS-US MN AN-BET (BTAL): ETF Research Reports
PWRSH-RU LBEWP (USLB): ETF Research Reports
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