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Large-Cap Equity ETFs Outperforming in 2013


U.S. equities started out the first half of 2013 with eye-catching performance, marked by the 13.82% gain in the S&P 500. Exchange traded funds that track large-cap companies have made gains as the broad market index has been on a run-up most of the year.

“Among equity ETFs classified as having a more domestic stock emphasis, 262 (97%) were in positive territory, along with 83 (43%) equity ETFs with more of an international or global emphasis. Among smaller-cap equity ETFs with more of a domestic stock emphasis, we think performance in the first half of 2013 was generally favorable as well,” reports S&P Capital IQ.

About 60% of U.S.stock-focused ETFs have a total return that surpassed the Standard & Poor 500. Conversely, about 11% of international or overseas focused ETFs posted a lower year-to-date return than the broad market index, reports S&P Capital in a recent note. [Three of the Top-Selling ETFs in 2013]

The year-to-date top-performing large-cap equity ETF so far is the First Trust NASDAQ Clean Edge Green Energy Index Fund (QCLN) matched by the Guggenheim Solar ETF (TAN) which have both returned 52%. [June and Q2 ETF Performance Report]

Of the 665 equity ETFs that were included in the survey, four had an “Overweight” ranking by S&P Capital. The top-performing Overweight ETFs were the iShares Dow Jones US Insurance Index Fund (IAK) , SPDR S&P Insurance ETF (KIE) , SPDR S&P Pharmaceuticals ETF (XPH) and the WisdomTree Japan Hedged Equity Fund (DXJ) . [Solar ETFs Dazzle in the Second Quarter]

“In such a scenario, large caps have been strong performers so far this year, and the gains are widely expected to continue as we approach the summer months. These securities seem to be more reasonably valued at this time and offer higher price appreciation, compared to small and mid cap securities in particular,” according to Zacks Equity Research.

First Trust NASDAQ Clean Edge Green Energy Index Fund


Tisha Guerrero contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.