As many as 250 exchange-traded funds (ETFs) launched this year. Among the list of ETF launches were the types of funds you might expect — the occasional dividend and gold ETF — but there were also a few unique funds that got their start.
These odd-ball funds embody the full essence of ETFs as a means to make money off particular flavors of the market.
Whether these new ETFs will be successful is still up in the air, but we can look at the oddballs (and just new ETFs in general) to get a greater understanding of how deep the market rabbit-hole goes. Is there a way of looking at markets that you’ve never considered before? Is there a batch of stocks you knew existed, but might find more appealing with the correct “packaging”?
The following are 10 new ETFs to keep watching in 2018:
Expense Ratio: 0.75%, or $75 annually per $10,000 invested
Some investors like to keep their money out of politics, but for those who are looking to intertwine their investments with their beliefs, or simply profit from current political happenings, Event Shares offers several unique politically slanted ETFs.
This list starts with the Event Shares Republican Policies Fund (BATS:GOP), though the Democratic alternative, Democratic Policies Fund (BATS:DEMS), or U.S. Tax Reform Fund (BATS:TAXR) are equally interesting choices.
As its name suggests, GOP focuses on stocks that are likely to benefit from Republican-based policies. With President Donald Trump at the helm and his policies in focus, GOP’s top holdings include companies like Arch Coal Inc (NYSE:ARCH), United States Steel Corporation (NYSE:X) and industrial equipment supplier W W Grainger Inc (NYSE:GWW).
Maybe ETFs like GOP and DEMS are not really “odd,” in the traditional sense, but they certainly offer a unique take on the market that many investors may find appealing as the Trump presidency continues to unfold. If you doubt his success, then DEMS might be a more attractive alternative.
Expense Ratio: 0.65%
It’s no secret that many brick-and-mortar stores have been decimated over the past few years with the unstoppable rise of juggernaut e-tailer Amazon.com, Inc. (NASDAQ:AMZN) and other long-term headwinds beating down the space.
If you’re intrigued by the death of traditional retail, then the Proshares Decline of the Retail Store ETF (NYSEARCA:EMTY) offers daily short exposure to the Solactive-ProShares Bricks and Mortar Retail Store Index.
Essentially, this means EMTY is geared towards letting investors take advantage of the death of retail every day the aforementioned index declines in value. This ETF “aims to make money on falling share prices by selling borrowed stocks and buying them back later, ideally at a lower price, to be returned for a profit.”
Obviously there’s risk involved with this method, and EMTY has dropped since its inception in November, but it’s important to consider that the holiday season is currently in effect and helping the otherwise troubled retail space.
Expense Ratio: 0.85%
The so-called “FANG” stocks have been the darlings of Wall Street for the past few years and many ETFs already exist that offer access to tech trends.
However, the AdvisorShares New Tech and Media ETF (NYSEARCA:FNG) is an interesting alternative, as it establishes the FANG stocks as the leaders of the next technological revolution and aims to identify and include other companies that have similar characteristics and potential.
As such, top holdings include names you’d expect like Amazon and Alphabet Inc (NASDAQ:GOOG, NASDAQ:GOOGL), but also other tech picks like logic-synthesis tool creator Synopsys, Inc. (NASDAQ:SNPS) and medical technology manufacturer Intuitive Surgical, Inc. (NASDAQ:ISRG).
FNG offers tons of potential for investors who are strong believers in the continual success of big tech and media names.
Expense Ratio: 0.69%
Prosports Sponsors ETF (BATS:FANZ) is undoubtedly one of the oddest of the oddball new ETFs on this list.
FANZ follows the ProSports Sponsors Index, which was created to track official partners of U.S. Pro Sports Leagues in football, baseball, hockey and basketball as well as their connected sports broadcasters.
Its top holdings consist of an eclectic combination of companies like hot-dog chain Nathan’s Famous, Inc. (NASDAQ:NATH) and hotel franchise Marriott International Inc (NASDAQ:MAR). And more obvious sports-related names like Nike Inc (NYSE:NKE) and Twenty-First Century Fox Inc (NASDAQ:FOXA).
Notably, all of its 100-plus holdings have sponsorships or deals with the aforementioned sports leagues. This makes FANZ an intriguing ETF for investors that are die-hard U.S. sports fans, or simply those that recognize — and want to make gains from — the various businesses that these sports help drive.
Expense Ratio: 0.65%
It’s hard to make a list of promising new ETFs without mentioning international stocks in some way. The Pacer Developed Markets International Cash Cows 100 ETF (BATS:ICOW) offers an interesting take on international stocks, as it isolates the “Top 100 international companies with the highest free cash flow yield.”
With top holdings like Fiat Chrysler Automobiles NV (NYSE:FCAU) and Samsung Electronics, ICOW gives investors exposure to top-notch international stocks with an emphasis on long-term capital appreciation. This means the ETF offers strong growth potential from well-established companies, implying significant reliability in the years ahead.
Notably, the fund leans heavily towards the consumer discretionary (32%) and materials (20%) sectors, and its holdings are largely based in Japan (42%) and the United Kingdom (15%).
Some investors view international stocks as too risky, but ICOW helps diminish this worry while offering unique growth potential.
Expense Ratio: 0.07%
The Vanguard Total Corporate Bond ETF (NASDAQ:VTC) might not be as much of an oddball as some of the other new ETFs on this list, but it still has some notable nuances that set it apart from most other funds.
VTC aims to grant investors diversified exposure to the U.S. corporate bond market through an “ETF of ETF” structure that tracks the Bloomberg Barclays U.S. Corporate Bond Index.
What all of this means is that VTC gives investors exposure to several different Vanguard bond index ETFs — Vanguard Short-Term Corporate Bond ETF (NASDAQ:VCSH), Vanguard Intermediate-Term Corporate Bond ETF (NASDAQ:VCIT) and Vanguard Long-Term Corporate Bond ETF (NASDAQ:VCLT) — that follow the aforementioned Barclays index, rather than consist of its own traditional list of holdings.
The ETF of ETFs approach gives VTC access to over 5,500 investment-grade U.S. corporate bonds in a way that reduces risk in high-yield bonds and avoids excessive exposure to consistently low-yield U.S. Treasuries.
This gives investors a relatively balanced combination of risk, reward and yield. Furthermore, as the different names of the ETFs it follows imply, the fund covers bonds from a short-term, intermediate-term and long-term perspective.
VTC looks to be the ultimate well-rounded choice for investors that are looking to get their hands on bonds.
Expense Ratio: 1.10%
Plenty of investors already know about the great potential of Chinese stocks, but they shouldn’t forget opportunities from our neighbors in Mexico — one of the top emerging markets. That brings us to Direxion Daily MSCI Mexico Bull 3X Shares (NYSEARCA:MEXX), a triple-leveraged ETF that focuses on the daily ups and downs of the Mexican market.
As with all leveraged ETFs, there is great risk involved, and the Mexican market hasn’t exactly been stable since the inception of MEXX. However, this pick may be appealing to brave investors that see upside in Mexican stocks in 2018 and are looking for short-term profits.
With top holdings like Mexican telecom America Movil SAB de CV (ADR) ADR (NYSE:AMX) and Mexican beverage and retail company Fomento Economico Mexicano SAB (ADR) (NYSE:FMX), investors get wide exposure to Mexican stocks with MEXX — for better or worse. Its sector allocation is primarily in consumer staples (26%) with relatively even allocations in financials (17%), telecommunication services (15.5%) and materials (15%) topping things off.
Expense Ratio: 1.88%
At first glance, new ETFs focused on green energy might seem like a bad idea, especially when you consider the current policies of President Trump. However, the VanEck Vectors Green Bond ETF (NYSEARCA:GRNB) focuses on “green bonds that are issued to finance environmentally friendly projects issued by supranational, government, and corporate issuers globally in multiple currencies.”
With GRNB, investors get exposure to green energy projects that aren’t reserved only for the U.S. Top holdings include French Republic Government Bond, European Investment Bank and Southern Co (NYSE:SO). It’s regional allocation is primarily in France (24%) and supra-national (18%), but the U.S. (12%) also has a significant presence.
Expense Ratio: 0.4%
Tortoise Water Fund (BATS:TBLU) is a standout pick among this year’s ETF launches. TBLU tracks the Tortoise Water Index in attempt to give investors a taste of “water infrastructure, management and treatment companies” that should gain strength as necessary improvements to water management practices persist.
Expense Ratio: 0.49%
With all the fuss surrounding the FANG stocks, it’s often easy to overlook other tech names, let alone tech names that aren’t U.S.-based, but ARK Israel Innovative Technology ETF (BATS:IZRL) gives investors a reason to remedy this oversight.
As an Israel-based ETF, IZRL gives investors exposure to tech companies based in the No. 1 ranked country “in the world for innovation capacity and entrepreneurship.”
But while it focuses heavily on Israeli information technology (57%) companies, it also provides some diversification with exposure to other sectors like healthcare (20%) and telecommunication services (12%).
As such, IZRL’s top holdings include well-known names like Teva Pharmaceutical Industries Ltd (ADR) (NYSE:TEVA) and lesser-known names like computer networking supplier Mellanox Technologies, Ltd. (NASDAQ:MLNX).
If you have faith in the continual success of Israeli innovations in technology, the IZRL is one of the most significant ETF launches this year.
Robert Waldo is an Assistant Editor at InvestorPlace. As of this writing, he did not hold a position in any of the aforementioned securities.