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Tags: exchange-traded funds | ETFs | market correction
OPINION

George Mentz: ETFs 40%-50% Off Their 52-Week Highs...Fire Sale or Correction?

stocks
(Dreamstime)

George Mentz By Friday, 11 February 2022 01:12 PM EST Current | Bio | Archive

Every so often, it is smart to do a screen of ETFs that are poorly performing. In this way, you can find a basket of stocks that may have some value in the ever changing economic cycles.

An ETF screener will allow you to search an ETF’s price performance for:  1 year or 3 years.  You would usually see a 52-week price range in an online portfolio that you build on a finance website using publicly traded symbols.

The search that I performed this week was for ETFs that are down more than 40% from their 52-week highs this year.  Amazingly, some of the ETFs that are in the search results are not what you would guess.  With COVID, there are many stay at home and e-commerce related Internet stocks that grew to all time highs very quickly in 2020-2021.  Many financial advisors are recommending some asset allocation into value stocks or inflation resistant stocks at this juncture.

With that being said, many of the high flying internet stocks were overpriced in recent months. Now, they have come down a bit, and some have come down 40-50% off of their highs. Several are trading at 2019 prices. The federal reserve rate hikes are looming, and many investors are concerned about tech stocks.

Here is the short list of ETFs.  To keep things, simple, this list shows the ETF Symbol, The ETF Price, The Name of the ETF, and the percentage down from the 52-week high.
 

ETFs On Sale

EDUT

7.97

Global X Education ETF

-63.24%

DAPP

13.84

VanEck Vectors Digital Transformation ETF

-61.94%

ENTR

12.74

ERShares Entrepreneur ETF

-60.93%

PBW

54.34

Invesco WilderHill Clean Energy ETF

-60.79%

VFIN

6.22

Simplify Volt Fintech Disruption ETF

-59.86%

BBC

28.68

Virtus LifeSci Biotech Clinical Trials ETF

-54.19%

GIGE

23.78

SoFi Gig Economy ETF

-51.05%

CUX

51.05

ProShares Long Online/Short Stores ETF

-51.02%

XBUY

31.24

Amplify International Online Retail ETF

-49.94%

IBUY

71.72

Amplify Online Retail ETF

-49.13%

XBI

90.79

Amplify Online Retail ETF

-48.06%

ONLN

49.57

ProShares Trust - ProShares Online Retail ETF

-46.96%

BTEC

39.17

Principal Healthcare Innovators Index ETF

-46.62%

IPOS

22.69

Renaissance International IPO ETF

-44.65%

BITS

16.35

Global X Blockchain & Bitcoin Strategy ETF

-42.99%

Source: Yahoo Finance 2/5/22

Keep in mind these are not as volatile as leveraged ETFs, but Funds that contain a wide variety of holdings.  One of the ETFs CLIX does have a short “brick and mortar” component, but the others are funds that hold many stock positions.  Please check the holdings of each ETF before you buy so that you are comfortable with what the ETF holds. 

There are reasons for the lower prices of some of these funds. A few of these” internet focused” ETFs have many holdings of big international or China companies, which have taken a hit in price in the last year. However, if you believe in the “Harry Dent” Demographics theories  of global market growth, you will see many of these ETFs have  great upside as per global population needs.  Due to the needs of billions of online consumers around the world, many of these ETFs have amazing long-term growth potential.

As a note, some of the ETFs above such as XBI, BBC, or BTEC are Pharma/Biotech oriented.  Again, these have risk, but the holdings are fairly diverse in these BioTech ETF funds.  Some of the ETFs are disrupter, IPO or Entrepreneur related.  Thus, all of the list above are interesting sectors, but the holdings of each ETF is what you should focus on before buying any one of these ETFs. Further, this list also has an excellent “e-learning fund”:  EDUT and a “Crypto Currency”  related fund:  BITS.

I would like to think that there is value in buying an ETF that is down  40-50% in price, but there are no guarantees. However, all of these may have long-term potential.

Happy Shopping.
_______________
George Mentz JD MBA CILS is a CWM Chartered Wealth Manager ®, global speaker - educator, tax-economist, international lawyer and CEO of the GAFM Global Academy of Finance & Management ®. The GAFM is a TUV accredited graduate body that trains and certifies professionals in 150+ nations under ISO 29990 standards. Mentz is also an award winning author and graduate law professor of wealth management in the USA.

Mentz is 1st in the world to be credentialed as a: Doctor of Jurisprudence, MBA, investment advisor, financial planner, US federal courts attorney, international law certification, & management consultant, and he is a two-time award winning professor teaching 250+ law, business, and ethics courses. Mentz was an economic advisor for the Trump Campaign CO, has published 40+ books and audio books who has written for the US Dept of Labor, O-Books UK, eFinancialCareers, & National Underwriter.

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GeorgeMentz
Every so often, it is smart to do a screen of ETFs that are poorly performing. In this way, you can find a basket of stocks that may have some value in the ever-changing economic cycles.
exchange-traded funds, ETFs, market correction
788
2022-12-11
Friday, 11 February 2022 01:12 PM
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