Equities have had a breakout year after seeing significant volatility in 2016. With stocks now gaining across the board in 2017, investors are increasing their confidence in equities.

While economic growth is predicted to be moderate, the current environment has been fueling gains for innovative and emerging technologies. This has been a trend globally throughout 2017 with China specifically seeing significant demand and sales growth.

Through November, the year’s top equity exchange-traded funds (ETFs) are all reporting a focus on emerging technologies and internet e-commerce. Below we provide the top four performing funds across the ETF market. With many forecasters reporting a continued bullish outlook into 2018, these funds could provide considerable opportunity for generating alpha, with built in sector risk hedging through a diversified investment fund.

These funds do not use leveraged investing and were selected based on performance through November 3, 2017.

ARK Innovation ETF (ARKK)

Price: $35.30

Average Volume: 109,218

YTD Return: 76.06%

Assets Under Management: $209.519 million

Fee: 0.75%

The ARK Innovation ETF has returned 76.06% in 2017. The ETF is managed by ARK Invest. It includes companies focused on genomics, web technology and industrial innovation. Companies are involved in the global market’s most innovative product developments, services, technologies and scientific research advancements. The Fund is actively managed and comprehensively includes top investments across three of the firm’s thematic strategies, ARKG, ARKQ and ARKW.

Top holdings in the Fund include Tesla Inc. (TSLA), Bitcoin Investment Trust (GBTC) and Stratasys LTD (SSYS). The Fund has been steadily outperforming the Dow Jones and S&P 500 over the past few years with a one-year return of 76.68% and a three-year return of 73.20%. 

ARK Web x.0 ETF (ARKW)

Price: $43.32

Average Volume: 65,411

YTD Return: 72.66%

Assets Under Management: $132.045 million

Fee: 0.75%

ARKW is another actively managed fund offered by ARK Invest. Companies in the Fund are involved in supporting digital transformation across the global economy. The Fund includes a wide range of sectors within the technology market. Over 40% of the Fund is invested in cloud computing, cybersecuritiy, big data and machine learning technology. The Fund also invests in e-commerce, digital media, blockchain, internet lending, mobile, social and the internet of things.

Top holdings in the Fund include Amazon.com (AMZN), Bitcoin Investment Trust (GBTC), Athenahealth (ATHN), 2U Inc. (TWOU), Twitter (TWTR) and Netflix (NFLX). The Fund has been steadily outperforming the Dow Jones and S&P 500 over the past few years with a one-year return of 75.37% and a three-year return of 113.07%. 

Guggenheim China Technology ETF (CQQQ)

Price: $60.36

Average Volume: 121,865

YTD Return: 71.14%

Assets Under Management: $331.075 million

Fee: 0.70%

The Guggenheim China Technology ETF has a year to date return of 71.14% in 2017. The Fund invests in publicly traded companies that derive the majority of their revenue from the information technology sector in China. CQQQ is an index fund. It seeks to replicate the investment returns of the AlphaShares China Technology Index by investing in the securities in the Index.

The Fund holds 72 securities. Its top holdings are Tencent Holdings (0700) Alibaba (BABA), Sunny Optical Tech (2382) and Baidu.com (BIDU). The Fund has a one-year return of 61.42% and a three-year return of 64.72%.

KraneShares CSI China Internet ETF (KWEB)

Price: $57.47

Average Volume: 523,485

YTD Return: 65.48%

Assets Under Management: $1.1 billion

Fee: 0.72%

The KraneShares CSI China Internet ETF has a year to date return of 65.48% in 2017. KWEB is a broadly diversified ETF that seeks to invest in the investable universe of China-based companies with the majority of their revenue derived from internet and internet-related business. The Fund uses an index replication strategy and invests in the securities of the CSI Overseas China Internet Index.

The Fund’s top holdings are Tencent Holdings (0700), Alibaba Group (BABA), Baidu (BIDU) and JD.com (JD). Over the past year it has returned 50.64%. Over the past three years it has a return of 57.24%.

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