It was another banner year for ETFs! With 247 new ETFs launched in 2019, the US-based ETF world now has over 2,400 ETFs. In the following graphic, we break them down by asset level, showing those that have at least $1 million.
As you can see, there are over 400 ETFs now that have over $1 billion in assets. That’s great news for us because the growing pool of highly liquid ETFs present more investment opportunities going forward.
2019 ETF Performance – By Asset Class
US Market Style Boxes – Large cap stocks ruled the roost, with all three large cap categories finishing above 30% for 2019. All three mid cap categories finished with just north of 25% results. Small caps saw the only variation, with small cap growth at 28.48%, while small cap value finished at 22.01%. Regardless, all nine US equity categories saw very strong results in 2019.
US Market Sectors – It was an interesting mix for US sector performance, as nine of the ten main sectors were all north of 20% gains for the year. Top performing Technology crushed it by nearly hitting 50%, while the only big laggard, Energy, finished under 10%. Growth was definitely the place to be, but so were most cyclicals and defensive sectors.
World Equities – Most major regions around the globe also enjoyed solid market performance in 2019. Although the US led with the strongest gains, Global (which usually includes more than half of its holdings in the US), International, and European equities all enjoyed gains greater than 22%. Japan, Emerging Markets, and Pacific/Asia ex-Japan saw gains in the high teens, while China was the laggard at 14.87%.
Bond ETFs – It wasn’t just equities that had a very strong 2019, most bond categories also saw their biggest gains in years. The more volatile bond categories (corporate, emerging markets, high yield, and long-term treasuries) all had gains of at least 14%. Intermediate-term bonds, TIPS, munis, and world bond categories all had strong showings in the high single digits, while short-term bonds came in with a respectable 4.98%.
Summary
Nearly all major ETF categories enjoyed solid gains, with some having their best performance in many years. It was an exciting year for investors. As we mentioned, we’re excited about the tremendous growth of the ETF industry and look forward to the opportunities it creates.
Optimus Advisory Group manages liquid tactical and alternative investment strategies that meet the needs of our clients. We use a disciplined, quantitative methodology to build and manage our portfolios.
Over a full market cycle, these strategies are designed to provide superior risk-adjusted returns while maintaining a low-correlation to traditional market indices.
All strategies are net results after subtracting a 1.50% annualized fee.
The performance results shown include the reinvestment of dividends and other earnings. Comparison of the Optimus Advisory Group Programs to any other indices is for illustrative purposes only and the volatility of the indices used for comparison may be materially different from the volatility of the Optimus Advisory Group Programs due to varying degrees of diversification and/or other factors. Different types of investments involve varying degrees of risk and there can be no assurance that any specific investment will be profitable. Optimus Advisory Group does not make any representation that the Optimus Advisory Group Programs will or are likely to achieve returns similar to those shown in the performance results in this presentation. Optimus Advisory Group reserves the right to trade different funds within their models.
The historical S&P performance results (and those of all other indices and index funds used as proxies for indices) are provided exclusively for comparison purposes only, so as to provide general comparative information to assist an individual client or prospective client in determining whether the performance of the Optimus' portfolio meets, or continues to meet, his/her investment objective(s). It should not be assumed that any Optimus portfolio holdings will correspond directly to any such comparative index.
Different types of investments and/or investment strategies involve varying levels of risk, and there can be no assurance that any specific investment or investment strategy (including the investment strategies devised or undertaken by Optimus Advisory Group) will be profitable for a client's or prospective client's portfolio. All performance results have been compiled solely by Optimus Advisory Group and have not been independently verified.
Performance results reflect hypothetical results that were achieved by means of the retroactive application of a back-tested model and, as such, the corresponding results have inherent limitations, including: (1) the model results do not reflect the results of actual trading using client assets, but were achieved by means of the retroactive application of each of the above referenced models, certain aspects of which may have been designed with the benefit of hindsight; (2) back-tested performance may not reflect the impact that any material market or economic factors might have had on the adviser’s use of the model if the model had been used during the period to actually manage client assets; (3) for various reasons (including the reasons indicated above), clients may have experienced investment results during the corresponding time periods that were materially different from those portrayed in the model.
The Optimus performance results do not reflect the impact of taxes.
Advisory Services offered through Optimus Advisory Group, a Registered Investment Advisor.
