As the pandemic and US presidential election dominate the new cycle, the Christmas shopping season is creeping up on consumers.
Amazon.com (NASDAQ 🙂 held all of its two-day Prime Day 2020 sales in mid-October, a month in which many US shoppers prepare for the upcoming festivities.
Deloitte & # 39; s Holiday Survey of Consumers 2019 says shoppers are "expected to spend $ 1,496 per household during the holiday season this year, with a CAGR of 5.4% since 2012".
Given questions about the state of the pandemic, and the overall gloomy mood caused by the pandemic, the holidays are likely to be markedly different from previous years.
While many households are likely to scale back their parties and shopping, we still expect the holidays to encourage many businesses.
Below are 2 ETFs that will benefit from buying season:
1. Amplify Online Retail ETF
Current Price: $ 100.22
52 Week Range: $ 33.11 – $ 100.40
Yield: 0.16%
Expense Ratio: 0.65%
Statistics for 2019 from Digital Commerce 360 ?? show that in the US:
"Online spend accounted for 16.0% of total retail sales for the year. Amazon accounted for more than a third of all e-commerce in the United States."
In the time of a pandemic, online shopping has become even more important, not only in the United States but worldwide. According to US Census Bureau monthly data as of September 2020:
“Retail sales increased 1.9 percent ( ± 0.5 percent) from August 2020, and 8.2 percent ( ± 0.7 percent) more than last year Non-retail chains were up 23.8 percent ( ± 1.6 percent) as of September 2019. "
The Amplify Online Retail ETF (NASDAQ 🙂 aims to capture the global shift to e-commerce. The fund provides exposure to international companies with 70% or more of the income from online sales.
IBUY, which has 49 holdings, tracks the EQM Online Retail Index.
The fund started trading in April 2016. Approximately 77% of companies are based in the US, followed by China, Germany, the UK and Israel.
The top ten companies comprise 40% of net assets in excess of $ 1 billion. Interactive Fitness Platform Peloton Interactive (NASDAQ 🙂 Used Car Ecommerce Platform Carvana (NYSE 🙂 Virtual Personalized Styling Service Stitch Fix (NASDAQ 🙂 , stock photography provider Shutterstock (NYSE 🙂 and online fashion retailer Revolve (NYSE 🙂 lead the ETF businesses.
Since the beginning of the year, the fund is up 85%, hitting a record high of $ 98.99 on Oct. 14. The investors who are also following the short-term technical charts might be interested to know that the recent run-up in price, especially in recent days, has pushed several indicators into overbought territory. Thus taking profit in the short term is possible.
Long-term investors, however, may view such a withdrawal as an opportunity to go long on the stocks. In addition to the pandemic and the Christmas shopping season, consumer buying habits could increasingly move online.
2. Ecofin Digital Payments Infrastructure Fund
Current Price: $ 38.09
52 Week Range: $ 20.31 – $ 39.19
Yield: 0.10%
Expense Ratio: 0.40%
Over the past decade, financial technology and digital payments have evolved rapidly. During the week, the initial public offering (IPO) by Ant, the Chinese fintech giant owned by Alibaba (NYSE 🙂 was suspended. If it went ahead it would have been the world's largest IPO.
Interest in Ant's forthcoming IPO was great, partly due to the growth of the industry. Figures from MarketsandMarkets show:
"The global size of the digital payments market is expected to grow from $ 79.3 billion in 2020 to $ 154.1 billion by 2025, at a compound annual growth rate (CAGR) of 14.2%."
The Ecofin Digital Payments Infrastructure Fund (NYSE 🙂 seeks to participate in the growth of the industry by investing in global companies that are part of the digital payments value chain. These companies mainly include electronic transaction processors, credit card networks, payment products and services for merchants and payment companies.
TPAY has 50 interests. The top ten companies make up about half of the fund. These include France-based payment service provider Worldline (PA :), headquartered in Australia Afterpay (OTC 🙂 direct banking and payment services Financial Discover Services (NYSE: ) Dutch Payment Solutions Adyen (OTC 🙂 and Commerce Ecosystem Square (NYSE :).
Year-to-date, the fund is up 18%. It should be noted that the fund started trading in early 2019 and thus does not have much performance history to analyze. Plus, it's a small fund with just $ 7.5 million under management. However, we believe that the secular trend towards digitization is an important trend for long-term investors to keep an eye on.
