These ETFs Were On Fire In 2020 – With More Possible Upside In 2021

  • Editor's Pick

If you are thinking about investing in exchange-traded funds (ETFs) next year, there are several that provided double-digit returns in 2020 that could possibly continue to do well in the coming quarters. Here are some that should be on your radar.

We are not going to include the ETFs from yesterdays article}}. And, again, we are excluding {{art-200544429||leveraged and inverse ETFs, which should typically be used only by experienced short-term traders.

Even in a robust year, stocks and ETFs can slide for a number of reasons. As 2020 has shown, for most retail investors, a buy-and-hold strategy as well as regular investing are likely to be more appropriate than constantly worrying about short-term gyrations in prices.

Here are 40 ETFs (listed in alphabetical order), covering a range of sectors and investment themes that we would be happy to hold in 2021.

ETFs That Hold A Large Number Of Stocks

The following 10 ETFs invest in a large universe of shares, providing diversification, especially for long-term investors. This strategy also insures that price moves in a given stock within the fund do not necessarily affect the price of a given fund significantly.

  • JPMorgan U.S. Momentum Factor ETF (NYSE: JMOM ) — up 26.7% YTD, covered here)
  • iShares MSCI USA Quality Factor ETF (NYSE: QUAL ) — up 14.1% YTD, covered here)
  • iShares Core S&P Total U.S. Stock Market ETF (NYSE: ITOT ) — up 17.8% YTD, covered here)
  • Schwab Emerging Markets Equity ETF™ (NYSE: SCHE ) — up 10.6% YTD, covered here)
  • SoFi Select 500 (NYSE: SFY ) — up 22.2% YTD, covered here)
  • SPDR® S&P MIDCAP 400 ETF Trust (NYSE: MDY ) — up 10.8% YTD, covered here)
  • Vanguard Dividend Appreciation Index Fund ETF Shares (NYSE: VIG ) — up 12.1% YTD (covered here)
  • Vanguard Russell 1000 Growth Index Fund ETF Shares (NASDAQ: VONG ) — up 36.9% YTD (covered here)
  • Vanguard Small-Cap Growth Index Fund ETF Shares (NYSE: VBK ) — up 33.5% YTD (covered here)
  • Vanguard Total Stock Market Index Fund ETF Shares (NYSE: VTI ) — up 18.0% YTD (covered here)

Technology ETFs

Technology shares were the most impressive winners in 2020. Although valuations of many of the darlings of Wall Street look frothy, we believe investors will continue to put their trust and capital into well-run technology names. Therefore, we believe the following 11 ETFs could reward investors in 2021, too.

  • Amplify International Online Retail ETF (NYSE: XBUY ) — up 80.4% YTD (covered here)
  • ARK Autonomous Technology & Robotics ETF (NYSE: ARKQ ) — up 100.3% YTD (covered here)
  • Communication Services Select Sector SPDR® Fund (NYSE: XLC ) — up 25.6% YTD (covered here)
  • Ecofin Digital Payments Infrastructure Fund (NYSE: TPAY ) — up 39.9% YTD (covered here)
  • First Trust NASDAQ Cybersecurity ETF (NASDAQ: CIBR ) — up 46.8% YTD, covered here)
  • Global X Autonomous & Electric Vehicles ETF (NASDAQ: DRIV ) — up 59.3% YTD (covered here)
  • iShares PHLX Semiconductor ETF (NASDAQ: SOXX ) — up 48.1% YTD (covered here)
  • Robo Global® Artificial Intelligence ETF (NYSE: THNQ ) — up 57.2% since early May when it started trading, covered here)
  • Roundhill BITKRAFT Esports & Digital Entertainment ETF (NYSE: NERD ) — up 85.3% YTD, covered here)
  • SPDR S&P Kensho Smart Mobility (NYSE: HAIL ) — up 79.1% YTD, covered here)
  • VictoryShares Nasdaq Next 50 ETF (NASDAQ: QQQN ) — up 23.9% since early September when it started trading, covered here)

Diverse Themes And Sectors

Our final 19 ETFs offer ample diversification. Some give access to commodities, others provide exposure to companies that have recently gone public. Yet, several others move beyond the borders of the U.S. health care, education, material, homebuilders, clean energy are other themes provided by the following funds.

When doing due diligence, we’d encourage investors to choose funds with businesses that offer long-term growth prospects as well as solid and visible earnings outlook for many quarters to come.

  • Aberdeen Standard Physical Silver Shares ETF (NYSE: SIVR ) — up 46.4% YTD, covered here)
  • Defiance Next Gen SPAC Derived ETF (NYSE: SPAK ) — up 11.6% since early October when it started trading, covered here)
  • ERShares Entrepreneur 30 ETF (NYSE: ENTR ) — up 43.2% YTD, covered here
  • ETFMG Treatments, Testing and Advancements ETF (NYSE: GERM ) — up 23.3% since mid-June when it started trading (covered here)
  • Global X Education ETF (NASDAQ: EDUT ) — up 20.3% since mid-July when it started trading (covered here)
  • Global X Millennials Thematic ETF (NASDAQ: MILN ) — up 44.0% YTD (covered here)
  • Global X MSCI China Consumer Disc ETF (NYSE: CHIQ ) — up 84.4% YTD, covered here)
  • Goldman Sachs Hedge Industry VIP ETF (NYSE: GVIP ) — up 42.75% YTD, covered here )
  • Health Care Select Sector SPDR® Fund (NYSE: XLV ) — up 10.2% YTD, covered here)
  • iShares Global Materials ETF (NYSE: MXI ) — up 20.1% YTD, covered here)
  • iShares MSCI Taiwan ETF (NYSE: EWT ) — up 27.7% YTD, covered here)
  • iShares U.S. Home Construction ETF (NYSE: ITB ) — up 27.1% YTD, covered here)
  • ProShares Pet Care (NYSE: PAWZ ) — up 60.9% YTD, covered here)
  • Renaissance IPO ETF (NYSE: IPO ) — up 108.4% YTD, covered here)
  • SPDR® Kensho Clean Power ETF (NYSE: CNRG ) — up 130.3% YTD, covered here)
  • VanEck Vectors Gold Miners ETF (NYSE: GDX ) — up 22.1% YTD, covered here)
  • VanEck Vectors Low Carbon Energy ETF (NYSE: SMOG ) — up 112.1% YTD, covered here)
  • VanEck Vectors Agribusiness ETF (NYSE: MOO ) — up 12.1% YTD, covered here)
  • Vanguard ESG US Stock (NYSE: ESGV ) — up 23.4% YTD, covered here)

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