Buy Hold Sell: The best and worst-performing ETFs of the year

Buy Hold Sell

Livewire Markets

They say active management comes to the fore when markets are a mess. Unsurprisingly then, several active managers have recently forwarned investors to steer clear from "beta" products - like index-tracking ETFs, over the months ahead. 

While only time will tell if a passive or active approach outperforms in this tumultuous market, it may surprise investors to learn that more than 16% of the ETFs the ASX tracks delivered positive returns for investors in FY23, while 41% returned more than the S&P/ASX 200.*

So in this episode, Livewire's Ally Selby was joined by Shaw & Partners Felicity Thomas and Apt Wealth's Sarah Gonzales for a look at the best and worst performing ETFs over the past year. 

And a quick note that this episode was filmed before the ASX's June Data was released, so the best and worst performers on this list are to the end of May 2022. The ASX just released its June Fund data a few days ago. So without further ado, the best and worst performing ETFs of FY22 are:

Best:

  • BetaShares Crude Oil Index ETF (ASX: OOO): 67.09%
  • BetaShares Global Energy Companies ETF (ASX: FUEL): 29.63%
  • ETFS Ultra Short Nasdaq 100 Hedge Fund (ASX: SNAS): 29.45%
  • BetaShares Strong US Dollar Fund (ASX: YANK): 19.59%
  • BetaShares US Equities Strong Bear Currency Hedged (ASX: BBUS): 18.06%

Worst:

  • ETFS Ultra Long Nasdaq 100 Hedge Fund (ASX: LNAS): -50.25%
  • ETFS S&P Biotech ETF (ASX: CURE): -40.53%
  • BetaShares Global Robotics and Artificial Intelligence ETF (ASX: RBTZ): -36.50%
  • BetaShares Cloud Computing ETF (ASX: CLDD): -35.95%
  • BetaShares Asia Technology Tigers ETF (ASX: ASIA): -35.62%

Note: This video was shot on Wednesday 6 July 2022. You can watch the video, read the transcript or listen to the podcast below. *From the ASX's monthly Fund Statistics. 

Edited Transcript 

Ally Selby: Hey, how are you doing and welcome to Livewire's Buy Hold Sell. I'm Ally Selby and today we're going to be taking a look at some of the best and worst performing ETFs over the past year. To do that, we're joined by Felicity Thomas from Shaw and Partners and Sarah Gonzales from APT Wealth. 

First up today, we're going to be talking about some of the best performers. We have the BetaShares Crude Oil Index ETF. It returned 95.99% over the past 12 months to the end of May. Felicity, I might start on you. Is it a buy, hold or sell?

BetaShares Crude Oil Index ETF (ASX: OOO)

Felicity Thomas (SELL): This is going to be a sell, but in mid-2023, because you have to remember that they are actually trading futures contracts. It's not the spot price, so it's not something you want to hold long-term.

Ally Selby: This was actually one of the worst performing ETFs a few years ago, but it has had this amazing period of performance in the past year. Over to you, Sarah, is it a buy, hold or sell?

Sarah Gonzales (SELL): For me, it's also a sell. As Felicity mentioned, it's not exposing you to the oil spot price, instead, it exposes you to futures contracts. It's a completely synthetic ETF. For us, we try to stay away from 100% synthetic ETFs and the oil price has rallied quite a bit. It's very hard to see it continue in the next 12 months.

Ally Selby: It's actually already sold off, it's down around 22% over the past month. 

BetaShares Global Energy Companies ETF (ASX: FUEL)

Ally Selby: We're going to talk about our next ETF. It's FUEL, the BetaShares Global Energy Companies ETF. It returned around 59.24% over the 12 months to the end of May. Staying with you Sarah. Is it a buy, hold or sell?

Sarah Gonzales (SELL): Again, it's a sell for me, and for a similar reason to the first. Oil and gas prices have rallied quite a bit. This ETF provides exposure to oil and gas companies across the supply chain, but they're still exposed to that oil price.

Ally Selby: This one has management fees of 0.57%, and it's actually sold off around 16% over the past month. Felicity over to you. Is it a buy, hold or sell?

Felicity Thomas (BUY): I'm actually going to go with a buy because it has some of the world's largest energy companies and energy generation is actually going to increase 150% by 2030. I think it's a buy.

VanEck Australian Resources ETF (ASX: MVR)

Ally Selby: Next up today, we've got the VanEck Australian Resources ETF. It returned around 22.57% over the 12 months to the end of May. They have management fees of around 0.35% per annum. Felicity, is it a buy, hold or sell?

Felicity Thomas (HOLD): I'm going to go for a hold at the moment. The reason is if iron ore prices do soften, we might have a bit of trouble. But a hold for the dividends. We love resources for dividends.

Ally Selby: And investors love dividends as well. Similarly, this one has sold off recently. It's down around 17% over the past month. Sarah, is it a buy, hold or sell?

Sarah Gonzales (SELL): It's a hold for me, but ultimately a sell moving forward. This ETF predominantly focuses on Australian commodities, which predominantly is made up of iron ore. With this ETF, the top five make up 50% of the portfolio. But could you get better exposure in a more broad-based index that's Aussie? Possibly.

Ally Selby: Okay, I'm going to push you for one. Would it be a hold or a sell?

Sarah Gonzales: It's a sell for me.

ETFS S&P Biotech ETF (ASX: CURE)

Ally Selby: Let's move to some of the worst performers over the past year. First up we have ETFS S&P Biotech ETF. The ticker is CURE. It fell around 40.09% over the 12 months to the end of May. It has management fees of 0.45% per annum. Staying with you, Sarah, is it a buy, hold or sell?

Sarah Gonzales (HOLD): It's a hold for me. Biotech has really sold off and I think it has a way to recover. People that are holding it should continue to hold it.

Ally Selby: It actually has lifted over the past month. It's up around 11%. Over to you Felicity. Is it a buy, hold or sell?

Felicity Thomas (BUY): I'm going to go with a buy. Look I like to buy ETFs for the long term. We have an ageing population, and what's the most important thing in the world? Your health. Biotech, healthcare, and life sciences, that's where you want to be invested over the next couple of decades.

BetaShares Asia Technology Tigers ETF (ASX: ASIA)

Ally Selby: Next up we have the BetaShares Asia Technology Tigers ETF. The ticker is ASIA. It fell 32.07% over the 12 months to the end of May. It has management fees of around 0.67% per annum. Is this one a buy, hold or sell?

Felicity Thomas (BUY): This is a buy for me. The reason being is that it has really solid names. Like your Alibaba, your Tencent, and it's been sold off significantly. Additionally, Asia's GDP growth is predicted to be over 5% for 2022 and 2023. So buy from me.

Ally Selby: This one has been pretty flat over the past month. Is it a buy, hold or sell?

Sarah Gonzales (SELL): It's a sell. There's no doubt that Asia is growing, but the exposure to China, Taiwan and Hong Kong makes up about 73% of this ETF. There's always a risk of further regulation in particular companies, so for me, it's a sell.

ETFS Long Nasdaq 100 Hedge Fund (ASX: LNAS)

Ally Selby: Last but not least today, we have the ETFS Long Nasdaq 100 Hedge Fund. The ticker is LNAS. It fell 25.75% over the 12 months to the end of May. It has management fees of 1% per annum, a little bit more expensive. Sarah, last one for you today. Is it a buy, hold or sell?

Sarah Gonzales (HOLD): For me, it's a hold. I think this ETF has sold up quite a bit and I do expect markets to recover, and when that happens this ETF should start to perform.

Ally Selby: This one hasn't performed that well over the past month, it's down a further 21% in a month when the NASDAQ has fallen 5%. Over to you Felicity. Last one for you today, is it a buy, hold or sell?

Felicity Thomas (BUY): I'm going to say a buy because interest rates are predicted to start cutting next year, and this might be quite volatile for the next couple of months. But as soon as that uptick happens, you don't want to miss out.

Ally Selby: I can't believe we're talking about cutting interest rates already. I hope you enjoyed that episode of Buy Hold Sell. If you did, why not give it a like, remember to subscribe to our YouTube channel. We're adding so much great content every week.


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