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July 4 travel is set to stay strong despite inflation and high gas prices. These ETFs could benefit from holiday spending trends.
As the political landscape and high stock valuations in the U.S. lead investors to seek new international markets to invest in, MFS Investment Management has launched a new emerging markets ETF that is actively managed.
I assign a 'stay away' rating to the U.S. Global Jets ETF, preferring selective stock-picking over broad sector exposure. JETS is heavily concentrated in the Big 4 US airlines, with 42% allocation, and charges a relatively high 60 bps management fee. I project US airline revenues to grow less than 5% over the next four quarters, with business conditions remaining steady but not exceptional.
KOMP offers a compelling opportunity to participate in the rapid development and gradual implementation of innovative technologies. The fund could benefit from the AI-driven technology advancement, diversifying away from the growing market concerns regarding tech overvaluation. My calculations point to a decent upside potential of up to 27% over the next 12-month horizon.
Markets may have entered a new cycle. Here's why.
Cautious consumers, strong goods demand! ETFs to watch this holiday season: likely winners XLY, ONLN, BPAY, CHAT, likely laggards EATZ, AWAY.
PSP is a strong sell due to persistent underperformance versus SPY and its high expense ratio, eroding any potential alpha. Private equity exposure can be achieved more efficiently by directly holding top players like Blackstone, KKR, and Ares, avoiding ETF fees. PSP's asset mix dilutes returns by combining best-in-class managers with weaker players, resulting in subpar performance.
Lower gas prices and record travel could lift ETFs like JETS, BEDZ and EATZ during the July 4 holiday rush.