If the business world is competitive (it is), it can be said the exchange-traded funds (ETFs) arena is hyper-competitive. In the U.S., dozens of companies participate in the ETF business, but a small amount control the bulk of the roughly $3 trillion in combined assets allocated to U.S.-listed exchange traded products.
Just look at iShares and Vanguard. Those two ETF titans have nearly $2 trillion in U.S. ETF assets combined.
Moving down the list of ETF providers, the gaps are significant. For example, Vanguard has about 50% more in U.S. ETF assets than does State Street, while the SPDR issuer is more than quadruple the size of fourth-place PowerShares.
All of this is to say that new ETF providers need to compete on fees and/or offer unique products to gain a foothold in this intensely competitive industry. Even then, those factors are not guarantors of success. However, some issuers have risen to prominence with lineups comprised of alternative, interesting and unique ETFs.
That is the case with Global X, which had $5.8 billion in ETF assets as of Aug. 2. Sure, that is small compared to the likes of iShares and Vanguard, but that figure also underscores the point that some Global X ETFs have gained notable followings with investors. For the most part, New York-based Global X does not focus on plain vanilla funds.
Rather, the Global X ETFs offer investors exposure to income-generating asset classes, previously hard to access countries and regions and commodities-related equities, among investments. What follows are some of the best Global X ETFs.
Global X ETFs to Buy: Global X SuperDividend ETF (SDIV)
Expense Ratio: 0.58% annually, or $58 on a $10,000 investment
The Global X SuperDividend ETF (NYSEARCA:SDIV) has $967 million in assets under management, making it one of the largest Global X ETFs. What makes SDIV one of the best Global X ETFs is its appeal to income investors while providing some ex-U.S. exposure with the comfort of a still substantial 46.2% weight to U.S. stocks.
SDIV features a trailing 12-month dividend yield of 6.73%, according to issuer data. That is more than triple what investors will find on the S&P 500. After the U.S., the next largest country weight in this Global X ETF is Australia. One of the highest-yielding developed markets in the world, Australia is 12.3% of SDIV’s roster.
Real estate investment trusts (REITs) account for nearly half of SDIV’s weight while consumer discretionary and financial services stocks combine for about 25% of this fund’s weight. Another advantage of this Global X ETF: it pays a monthly dividend.
Global X ETFs to Buy: Global X Robotics & Artificial Intelligence ETF (BOTZ)
Expense Ratio: 0.68%
Still about a month shy of its first anniversary, the Global X Robotics & Artificial Intelligence ETF (NASDAQ:BOTZ) could easily be one of the best Global X ETFs that are still in their infancy. After all, it has been proven that the concept of robotics investing in the ETF wrapper is more than viable.
BOTZ adds to that thesis. At just 11 months old, BOTZ has over $300 million in assets under management. This Global X ETF tracks the Indxx Global Robotics & Artificial Intelligence Thematic Index, a benchmark designed to give investors exposure to companies “involved with industrial robotics and automation, non-industrial robots, and autonomous vehicles,” according to Global X.
In terms of sheer performance, BOTZ is one of the best Global X ETFs this year with a gain of 33.5%. That is to say BOTZ has spent significant time in recent weeks printing a series of record highs.
Global X ETFs to Buy: Global X Lithium ETF (LIT)
Expense Ratio: 0.76%
Like many Global X ETFs, the Global X Lithium ETF (NYSEARCA:LIT) carved out a niche in what was expected to be a hot investment concept before rival issuers got to the party. While that strategy does not always prove successful, LIT has proven durable despite once being assailed as too much of a niche product.
LIT turned seven last month and it has more than $294 million in assets under management. What makes LIT one of the best Global X ETFs is that the ETF has been surging without significant dependence on the one stock many investors associate with lithium trends: Elon Musk’s Tesla Inc (NASDAQ:TSLA).
Yes, it helps that Tesla is 6% of LIT’s lineup and it is clear that the stock has played a role in this Global X ETF gaining nearly 31% year-to-date. However, LIT’s top two holdings combine for 41.6% of the ETF’s weight and are up an average of 47% this year.
As of this writing, Todd Shriber did not hold a position in any of the aforementioned securities.
