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ETF Leaders and Laggards for Q3 2013

Social media was grand, but gold miners ... not so much

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Leader #1: Global X Social Media Index ETF

GlobalX185Q3 Total Return: +33%

It seems investors are finally taking social media seriously.

Facebook (FB) is trading above its IPO price, LinkedIn (LNKD) and Groupon (GRPN) are on tears, and even Twitter is getting all sorts of pre-IPO buzz, suggesting the company is worth as much as $20 billion. The major beneficiary of all this investor love for social media is the Global X Social Media Index ETF (SOCL), which is coming up on its second anniversary.

The fund’s 27 holdings have hit it out of the park in Q3, bolstering SOCL by 33% during the past three months and gaining more than 50% year-to-date. While its underlying holdings are doing well, though, investors clearly are also poring into the fund to take advantage of the Twitter hype.

But is it hype? Internet penetration in India, China and Brazil is 8%, 36% and 37% respectively. This compares to 78% in the U.S. Considering 65% of adult internet users make use of one or more social networking sites, the growth curve for these sites in BRIC countries alone is enough to push SOCL higher.

There were better performances in Q3, but none that were more important. With just $54 million in total net assets, this quarter’s big move in SOCL might be the tonic to grow that number. Congrats to those that bought in at the end of 2012. You’ve done well for yourselves.

Article printed from InvestorPlace Media,

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