24 ETFs for 2024, Pt. 2: Bitcoin & Defensive Ideas

In this second installment of our 24 ETFs for 2024 series, etf.com finance reporter Lucy Brewster spotlights six funds that investors will be watching in 2024 with themes surrounding the highly anticipated spot bitcoin ETF launch, the evolving stories of cannabis and ESG funds, as well as defensive ideas for investors wanting alternatives to aggressive growth. 

ProShares Bitcoin Strategy ETF 

As we ramp up to see the potential launch of the novel spot bitcoin ETF, it is an open question what happens to the biggest and most valuable cryptocurrency futures ETFs, which just hit their peak in assets in the past month. All eyes will be on the ProShares Bitcoin Strategy ETF (BITO) as the reception for the first spot bitcoin ETFs unfolds.  

• AUM: $1.6 billion 
• Expense ratio: 0.95% 
• YTD performance: 148.80% 
• As of date: Dec. 21, 2023 

ETFMG Alternative Harvest ETF 

This pot ETF was once hailed as tapping into the future cannabis economy, but investors have been met with disappointment as the performance for the ETFMG Alternative Harvest ETF (MJ) has sunk nearly 30% in the past year. Yet after some positive regulatory news, the cannabis fund appears to be building a foundation to build upon in 2024. 

• AUM: $207.3 million 
• Expense ratio: 0.75% 
• YTD performance: -28.58% 
• As of date: Dec. 21, 2023  

iShares ESG Aware MSCI USA ETF 

The iShares ESG Aware MSCI USA ETF (ESGU) is the largest index that tracks companies selected and weighted for environmental, social and governance factors. In 2023, the fund lost $9 billion in assets after BlackRock tweaked its model portfolios. As ESG continues to face conservative political backlash and regulatory scrutiny, it is unclear how ESG-focused funds will evolve, making them a story for investors to watch in 2024. 

• AUM: $13.3 billion 
• Expense ratio: 0.15% 
• YTD performance: 25.05% 
• As of date: Dec. 21, 2023 

Health Care Select Sector SPDR Fund 

The healthcare sector had a rough 2023, with some areas like medical devices shifting from gains to losses while pharma companies making new anti-obesity drugs were the outlier strong performers. Heading into 2024, healthcare stocks and ETFs like the Health Care Select Sector SPDR Fund (XLV) could have a better year with improving valuations, medical advances, an aging population and defensive qualities in a slowing economy. 

• AUM: $37.4 billion 
• Expense ratio: 0.10% 
• YTD performance: 0.54% 
• As of date: Dec. 21, 2023 

Utilities Select Sector SPDR Fund  

Although utilities were one of the worst-performing sectors of 2023, funds like the Utilities Select Sector SPDR Fund (XLU) finished the year on a positive note. In the last two months of the year, XLU jumped 10% as investors appeared to be seeking yields in traditional dividend-producing stocks as fixed income yields declined. In addition to solid yields, utilities stocks are known for their defensive qualities, which may add to their attractiveness in 2024. 

• AUM: $14.0 billion 
• Expense ratio: 0.10% 
• YTD performance: -8.52 
• As of date: Dec. 21, 2023  

iShares Core S&P 500 

Already one of the largest ETFs in the world, the iShares Core S&P 500 (IVV) saw a startling number of inflows in 2023, taking in about $6 billion in inflows in the past month alone. Investor enthusiasm for this fund may be attributed to performance-chasing after large-cap tech stocks drove S&P 500 gains in 2023, but it helps that the fund has high assets under management and low expenses. The story for 2024 may be whether or not market-cap-weighted ETFs like IVV can continue the strong performance or if equal-weight funds gain investor favor. 

• AUM: $385.6 billion 
• Expense ratio: 0.10% 
• YTD performance: 25.60% 
• As of date: Dec. 21, 2023