Posted on by Micah McDonald

4 Best Long-Term Performance Miscellaneous Sector ETFs 1.4

  • Asset Class: Miscellaneous Sector

  • Best performing ETF back tested: First Trust Water ETF (FIW)

  • Correlation to U.S. Stock Market: 0.90

  • Long-Term Performance: 10.38% CAGR

  • S&P 500 Performance: 9.01% CAGR

  • Back test timeframe: June 2007 – December 2020

  • Number of ETFs available in this asset class: 29

  • Number of ETFs in this asset class that are 10-years old or older: 11

FIW vs SPY: May 11, 2007 – January 8, 2021

FIW vs SPY: June 2007 – December 2020

The Deep Value ETF Accumulator rankings for the 11 oldest Miscellaneous Sector ETFs:

The 4 top ranked Miscellaneous Sector ETFs head-to-head comparisons:

FIW vs QCLN vs PZD vs GRID: December 2009 – December 2020

FIW vs QCLN vs PZD vs GRID: November 17, 2009 – January 8, 2021

FIW vs QCLN: June 2007 – December 2020

QCLN vs PZD: March 2007 – December 2020

PZD vs GRID: December 2009 – December 2020

Stated objectives of 4 top ranked Miscellaneous ETFs:

FIW – The First Trust Water ETF is an exchange-traded fund. The investment objective of the Fund is to seek investment results that correspond generally to the price and yield, before fees and expenses, of an equity index called the ISE Clean Edge Water Index. The ISE Clean Edge Water Index is a modified market capitalization-weighted index comprised of exchange-listed companies that derive a substantial portion of their revenues from the potable and wastewater industry. The Index begins by establishing the total population of stocks in the potable and wastewater industry and eliminates stocks which do not meet the Index’s baseline eligibility requirements. To meet Index eligibility, a stock must satisfy market capitalization, liquidity and weighting concentration requirements. The Index selects the top 36 stocks in the industry by market capitalization. The Index is rebalanced on the application of the above model on a semi-annual basis.

QCLN – The First Trust NASDAQ® Clean Edge® Green Energy Index Fund is an exchange-traded index fund. The objective of the Fund is to seek investment results that correspond generally to the price and yield (before the Fund’s fees and expenses) of an equity index called the NASDAQ® Clean Edge® Green Energy IndexSM. The index is a modified market capitalization weighted index designed to track the performance of clean energy companies that are publicly traded in the United States and includes companies engaged in manufacturing, development, distribution and installation of emerging clean-energy technologies including, but not limited to, solar photovoltaics, biofuels and advanced batteries. The NASDAQ® Clean Edge® Green Energy IndexSM is a modified market cap weighted index in which larger companies receive a larger index weighting. The index weighting methodology includes caps to prevent high concentrations among larger alternative energy stocks. The index is reconstituted twice a year in March and September and rebalanced quarterly.

PZD – The Invesco Cleantechâ„¢ ETF (Fund) is based on the Cleantech Indexâ„¢ (Index). Cleantech considers a company to be a cleantech company when it derives at least 50% of its revenues or operating profits from cleantech businesses, which are defined as: businesses that provide knowledge-based products or services that add economic value by reducing cost and raising productivity and/or product performance, while reducing the consumption of resources and the negative impact on the environment and public health. The Fund generally invests in all of the securities comprising its Underlying Index in proportion to their weightings in the Underlying Index. The Fund and the Index are rebalanced and reconstituted quarterly.

GRID – The First Trust NASDAQ® Clean Edge® Smart Grid Infrastructure Index Fund is an exchange-traded fund. The Fund seeks investment results that correspond generally to the price and yield (before the Fund’s fees and expenses) of an equity index called the NASDAQ OMX® Clean Edge® Smart Grid Infrastructure IndexSM. The index is designed to track the performance of common stocks in the grid and electric energy infrastructure sector. The index includes companies that are primarily engaged and involved in electric grid, electric meters and devices, networks, energy storage and management, and enabling software used by the smart grid infrastructure sector. To be included in the index, a security must meet certain criteria including being classified as a smart grid, electric infrastructure and/or other grid-related activities company according to Clean Edge, have a minimum worldwide market capitalization of $100 million, have a minimum free float of 20%, and have a minimum three-month average daily dollar trading volume of $500 thousand. The index employs a modified market-capitalization weighting methodology. At each evaluation, the index securities are classified as Pure Play or Diversified. The Pure Play securities are given a collective weight of 80% and the Diversified securities are given a collective weight of 20% in the index. The index is rebalanced quarterly and reconstituted semi-annually.

Thank you for taking time to read this article. If you found it useful, please share it with a friend.

Respectfully yours, Micah McDonald, aka the Deep Value ETF Accumulator

Previous Deep Value ETF Accumulator article on Miscellaneous Sector ETFs:

4 Best Long-Term Performance Miscellaneous Sector ETFs 1.3

Disclosure: We currently own shares of FIW and we intend to buy more shares in the future. I am not a professional investment advisor. Please perform you own due diligence or seek the advice of a Registered Investment Advisor before investing in any security mentioned in this article. This website contains affiliate links to M1 Finance and Google AdSense.