For ETFs, 2019 was the best of times, it was the worst—actually, no, it was pretty much just the best of times. Between the fee wars, the long-awaited ETF Rule and more than 200 new products hitting the market, this was yet another banner year for ETF issuers and investors alike.
As 2019 comes to a wrap, we thought it might be fun to look back on which fund reports got the most traffic in searches and talk about why they spark investor curiosity.
No. 1: QQQ
With roughly $84 billion in assets under management (AUM), QQQ trades like a dream, making it by far investors' favorite proxy on the tech sector. QQQ is far from a pure play, however. Under the hood is a quirky mash-up of Nasdaq's biggest names, with more than one-third in nontech, nonfinancial securities.
Year to date, QQQ is up 35.1%.
No. 2: MJ
Marijuana had an exciting 2019, with seven new ETFs launched (including the first leveraged take) and more than a half-billion in new net inflows. So it's no wonder that the ETFMG Alternative Harvest ETF (MJ) remains a top draw for traders and retail investors alike fascinated by the promise of this budding new sector. (Read: "The Year In Marijuana ETFs.")
As the largest cannabis ETF, as well as the first to market, MJ has become something of a proxy for the marijuana industry writ large, even though the fund itself isn't precisely a pure play. (Its portfolio includes forward-looking stocks, such as alcohol, tobacco and fertilizer companies.) MJ is also no stranger to controversy or poor performance.
Still, with $702 million in AUM, MJ remains the go-to in the space; and while its seven competitors have tried to chip away at its dominance, so far none has been particularly successful.
MJ is down 28.4% year to date.
No. 3: SPY; No. 4: VOO; No. 9: IVV
It's telling that in a year that saw a deluge of new smart beta, thematic, active and even multifactor ETFs, the funds that attracted the most investor interest were those offering low-cost market beta—the same core equity exposure that has always made up the building blocks of any portfolio.
They're also among the cheapest, with VOO costing 3 basis points and IVV costing 4 bps. (SPY costs 0.09%.) As the ETF fee wars rage on, we expect these three funds to remain top of mind for readers. (Read: "Fund Fee Wars Save Investors Billions.")
Year to date, SPY, VOO and IVV are up 28.7%, 28.8% and 28.7%, respectively.
No. 5: VYM
The Vanguard High Dividend Yield ETF (VYM) is one of two high dividend ETFs to end up on this list, which makes a lot of sense in context: Interest rates may be rising, but still they remain at historical lows, leaving investors scrambling for any sort of income they can find. (Read: "Using Dividend ETFs For Income.")
VYM takes a smart-beta-lite approach toward security selection: Firms in its selection universe are ranked by their forecasted dividends over the next 12-month period, then the top half of those are included in the index. Securities are then weighted by market cap, rather than by dividend.
That leads to a diverse, yet relatively cheap, dividend-oriented portfolio. Currently, VYM offers a distribution yield of 3.01%. While higher yields can be found elsewhere, at 0.06% in expenses, VYM is the cheapest game in town.
VYM is up 22.1%, year to date.