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10 Top-Performing ETFs of the Past Decade

Sanghamitra Saha

The U.S. equity bull market completed 10 years on Mar 7, 2019. On the same day back in 2009, the S&P 500 touched a bear market nadir of 666.79, only to stage an astral rally. The run is the longest ever and the “the king of all bull markets.” With this stupendous equity rally showing no signs of a slowdown, some strategists like Jim Paulsen believe that “stocks are acting like it’s only the second year of a bull market.”

SPDR S&P 500 ETF SPY gained about 189.7% during the past 10 years, SPDR Dow Jones Industrial Average ETF DIA advanced 175.1% and the tech-heavy Invesco QQQ Trust QQQ added 366.9% (as of Dec 27, 2019).

From 2009 to 2019, the global investing backdrop has witnessed various key happenings. These include the subprime mortgage crisis, the aftermath of the fall of the investment bank Lehman Brothers in September 2008, the United States losing its triple-A credit rating, the Fed’s QE to boost an economy in recession, the Euro zone debt crisis, Abenomics in Japan, the Taper Tantrum in the United States, China’s soft landing issues, oil price massacre, initiation of QE by ECB, Brexit, the start of Trump era, ebb and flow in U.S.-China trade tensions and more.

The net result is that the global economy is on a moderate footing now. Though there are no recessionary fears right now, slowdown concerns can’t be ruled out. Still, we do believe that 2020 should be a year for stocks as dovish central banks amid slowing global economy will keep pumping cheap money into the economies. Trade tensions have eased considerably from the fourth quarter of this year. However, as markets have rallied ahead of the phase-one trade deal in early-2020, the real news may not boost markets as much as expected.

Against this backdrop, we would like to note a few decade-best ETFs.

iShares PHLX Semiconductor ETF SOXX – Up 412.5%

Rising consumer spending on technology, a 5G boom, expectations of higher smartphone sales, the announcement of the phase-one U.S.-China trade deal have been propelling the sector and the related funds (read: Time to Buy the Dip in Semiconductor ETFs?).

First Trust Dow Jones Internet Index Fund FDN – Up 456.6%

The past decade can easily be tagged as the emergence era for internet usage, mainly in the emerging economies. The e-commerce wave has been helpful in lifting Internet stocks. The global internet users were 23.5% of total population at the end of December 2008, which has risen to 58.8% at the end of June 2019 (read: Internet ETFs & Stocks Top Bull Market: Will the Rally Continue?).

SPDR S&P Biotech ETF XBI – Up 438.3%

Mergers and acquisitions, positive drug data and FDA approvals were the key tailwinds for the space. Between 2010 and 2018, FDA approvals for cancer therapies outdid endorsements for antibiotics and drugs used to treat central nervous system disorders and cardiovascular ills, which are also key therapeutic categories on their own.

iShares U.S. Medical Devices ETF IHI – Up 400.1%

This is another space from the medical sector which has been exhibiting upbeat growth. Since 2015, the area has been witnessing a CAGR of 5.2% (per KPMG) (read: 5 ETFs & Stocks to Profit From One-Year High U.S. Inflation).

Invesco QQQ Trust QQQ – Up 366.9%

The decade-long cheap money inflows and global economic improvement made growth stocks and the tech-heavy ETF winners last decade.

iShares U.S. Aerospace & Defense ETF ITA – Up 340.2%

This is one of the most dependable areas for investors. Growing demand from emerging markets and rising geopolitical tensions held the sector up. The fund can benefit specifically if there is a trade deal. 

Consumer Discretionary Select Sector SPDR Fund XLY – Up 323.4%

A dovish Fed, low rates, cheaper oil since 2014, a decently growing U.S. economy, solid job growth, a soaring stock market and the resultant wealth effect, and upbeat consumer confidence helped the consumer stocks and this ETF (read: Consumer ETFs: Bull Market Winners With Room to Run in 2019).

iShares U.S. Healthcare Providers ETF IHF – Up 316.4%

The fund measures the performance of the health care providers like health maintenance organizations, hospitals, clinics, dentists, opticians, nursing homes rehabilitation & retirement centres. These healthcare providers have benefited some way or the other from Obamacare.

First Trust U.S. Equity Opportunities ETF FPX – up 302.9%

The last decade has seen some huge IPOs including General Motors (GM), Alibaba (BABA), HCA Healthcare (HCA), Facebook (FB), Snap (SNAP), Uber (UBER), Kinder Morgan (KMI), Citizens Financial Group, Inc. (CFG) and made this fund one of the top performers.

Fidelity NASDAQ Composite Index Tracking Stock ONEQ – Up 291.1%

As growth stocks prevailed the value ones last decade, growth stock-heavy Nasdaq composite has gained materially and favored the fund. The index has been advancing by leaps and bounds in the recent times as well topping 9,000-mark this December (read: Nasdaq Hits 9,000 for the First Time: ETFs to Benefit).

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SPDR Dow Jones Industrial Average ETF (DIA): ETF Research Reports
 
Consumer Discretionary Select Sector SPDR Fund (XLY): ETF Research Reports
 
Fidelity NASDAQ Composite Index Tracking Stock Fund (ONEQ): ETF Research Reports
 
iShares U.S. Healthcare Providers ETF (IHF): ETF Research Reports
 
First Trust US Equity Opportunities ETF (FPX): ETF Research Reports
 
iShares U.S. Medical Devices ETF (IHI): ETF Research Reports
 
iShares PHLX Semiconductor ETF (SOXX): ETF Research Reports
 
First Trust Dow Jones Internet Index Fund (FDN): ETF Research Reports
 
SPDR S&P Biotech ETF (XBI): ETF Research Reports
 
iShares U.S. Aerospace & Defense ETF (ITA): ETF Research Reports
 
Invesco QQQ (QQQ): ETF Research Reports
 
SPDR S&P 500 ETF (SPY): ETF Research Reports
 
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