The annual ETF.com Awards is always an interesting event, with the winners representing the extreme standouts from the prior year. However, if you truly want to take the pulse of the ETF industry, you need to look at the nominees list as a whole. Keep in mind that anyone and everyone can participate in the nominations, so the contenders don’t consist only of issuers promoting their own products.
For example, the Direxion Work From Home ETF (WFH) was the only brand new ETF to be nominated for ETF of the Year—a category that rewards the most popular, most used, most talked about ETF of the year. WFH also cropped up as a nominee in three other categories, more than any other fund this year. That really speaks to just how much the fund resonated with investors, and with the industry at large, in a year marked by the coronavirus pandemic, with large swaths of the population working from home for extended periods.
The Best New ETF Issuer category in particular is a “who’s who” of new firms, including the likes of 6 Meridian, which offers tax-sensitive actively managed funds; TrueShares, an active manager offering defined outcome and thematic funds; Dimensional Fund Advisors, whose ETF entry was long-awaited by investors; and the Bank of New York Mellon, which came to market with a clutch of ultra-low-priced plain vanilla ETFs.
Continuing in that vein, the Best New ETF category represents a trove of funds that resonated during the year, including not just WFH, but the Roundhill Sports Betting & iGaming ETF (BETZ), which pulled in $150 million in its launch year, no doubt boosted by the need for entertainment during the pandemic.
Vanguard tapped into the demand for ESG strategies with the launch of the Vanguard ESG U.S. Corporate Bond ETF (VCEB), while—almost prophetically—BlackRock took aim at small cap value, an out-of-favor strategy in most of 2020, but one that’s gained traction in 2021.
The category’s winner, the Invesco NASDAQ Next Gen 100 ETF (QQQJ), covers the next 100 securities that are eligible for inclusion in the Nasdaq-100 Index, which exhibited stunning performance in 2020, and fit nicely with the market’s appetite for “what’s next” as an investment theme.
Themes really took the lead in 2020, and the Best Thematic ETF of the year is one of the few awards that have no launch date as a requirement. Two ARK funds made it into the nominations for the category, the ARK Genomic Revolution ETF (ARKG) and the ARK Innovation ETF (ARKK), reflecting not only the stellar performance of the ARK juggernaut during the year, but the importance of innovation during the pandemic, when technology and biosciences were in focus.
The Amplify Online Retail ETF (IBUY) was also nominated for the category, which isn’t surprising given how online shopping dominated the retail story in the year of a global pandemic. BETZ was also a nominee in this category, benefiting as it did from the pandemic. And the winner, the Global X Telemedicine & Digital Health ETF (EDOC), was also not surprising, given how healthcare suddenly became all about remote medicine, and was as important last year as remaining isolated.
We’re at an unprecedented time in the history of financial markets and in the history of ETFs. The ETF.com Awards reflect that. What’s exciting is that so far this year seen the biggest ETF launch ever (from BlackRock’s iShares arm), and the rollout of ARK’s much anticipated space fund, and we’re barely out of the first quarter.
Looking ahead to the rest of 2021, there’s still the possibility of the first U.S.-listed bitcoin ETF making it to market. This is only the start. The nominations for the next awards are likely to tell a story for 2021 that is just as compelling as the one for 2020.
Watch the 8th Annual ETF.com Awards.