With the creation of the first ETF in 1993, these new investment funds have become incredibly popular. These passively managed index funds are popular among small investors who want to invest without the hassle of purchasing a variety of individual stocks.
There are ETFs that track the major U.S. indices, as well as international and commodity-based ETFs. Inverse ETFs allow investors to hedge their losses when a given index is falling, as these ETFs perform in the opposite direction of the indices they track. They differ most from mutual funds in that they can be purchased and sold multiple times in a single day.
So what makes an ETF successful? One that benefits both investors and money managers.
Investors want high returns, and companies that manage ETFs want to maximize the amount of money placed in their funds. High-yielding funds are likely to attract more investors, which results in more earnings for the managing company — as their fees are based on a percent of assets managed.
The team at Credio was interested in finding the most successful ETFs of all time. Starting with the 100 largest ETFs by net assets, the team looked at those with the highest 10-year returns. These 19 largest ETFs boast the best track records over that period.
Noted returns are as of Aug. 31, 2015.
#19. XLK – Technology Select Sector SPDR ETF
Current value of $10,000 invested in 2005: $21,931
Ten-Year Annualized Return: 8.17%
Net Assets: $11.4 Billion
Investment Style: Technology
#18. VB – Vanguard Small-Cap ETF
Current value of $10,000 invested in 2005: $21,099
Ten-Year Annualized Return: 7.75%
Net Assets: $51.5 Billion
Investment Style: Small Blend
#17. MDY – SPDR S&P MidCap 400 ETF
Current value of $10,000 invested in 2005: $21,457
Ten-Year Annualized Return: 7.93%
Net Assets: $14.2 Billion
Investment Style: Mid-Cap Blend
#16. VXF – Vanguard Extended Market ETF
Current value of $10,000 invested in 2005: $21,084
Ten-Year Annualized Return: 7.74%
Net Assets: $41.4 Billion
Investment Style: Mid-Cap Blend
#15. VO – Vanguard Mid-Cap ETF
Current value of $10,000 invested in 2005: $21,289
Ten-Year Annualized Return: 7.85%
Net Assets: $62.3 Billion
Investment Style: Mid-Cap Blend
#14. VUG – Vanguard Growth ETF
Current value of $10,000 invested in 2005: $21,760
Ten-Year Annualized Return: 8.09%
Net Assets: $45.9 Billion
Investment Style: Large Growth
#13. IWP – iShares Russell Mid-Cap Growth
Current value of $10,000 invested in 2005: $21,347
Ten-Year Annualized Return: 7.88%
Net Assets: $5.77 Billion
Investment Style: Mid-Cap Growth
#12. IWO – iShares Russell 2000 Growth
Current value of $10,000 invested in 2005: $20,988
Ten-Year Annualized Return: 7.70%
Net Assets: $6.37 Billion
Investment Style: Small Growth
#11. IJH – iShares Core S&P Mid-Cap
Current value of $10,000 invested in 2005: $21,845
Ten-Year Annualized Return: 8.13%
Net Assets: $24.8 Billion
Investment Style: Mid-Cap Blend
#10. VGT – Vanguard Information Technology ETF
Current value of $10,000 invested in 2005: $22,999
Ten-Year Annualized Return: 8.69%
Net Assets: $7.51 Billion
Investment Style: Technology
#9. VBK – Vanguard Small-Cap Growth ETF
Current value of $10,000 invested in 2005: $22,016
Ten-Year Annualized Return: 8.21%
Net Assets: $15 Billion
Investment Style: Small Growth
#8. IJK – iShares S&P Mid-Cap 400 Growth
Current value of $10,000 invested in 2005: $23,472
Ten-Year Annualized Return: 8.91%
Net Assets: $5.3 Billion
Investment Style: Mid-Cap Growth
#7. GLD – SPDR Gold Shares
Current value of $10,000 invested in 2005: $22,622
Ten-Year Annualized Return: 8.51%
Net Assets: $24.6 Billion
Investment Style: Commodities Precious Metals
#6. XLY – Consumer Discret Sel Sect SPDR ETF
Current value of $10,000 invested in 2005: $26,417
Ten-Year Annualized Return: 10.20%
Net Assets: $9.94 Billion
Investment Style: Consumer Cyclical
#5. XLP – Consumer Staples Select Sector SPDR ETF
Current value of $10,000 invested in 2005: $26,256
Ten-Year Annualized Return: 10.13%
Net Assets: $7.36 Billion
Investment Style: Consumer Defensive
#4. XLV – Health Care Select Sector SPDR ETF
Current value of $10,000 invested in 2005: $25,183
Ten-Year Annualized Return: 9.68%
Net Assets: $12.9 Billion
Investment Style: Health
#3. VHT – Vanguard Health Care ETF
Current value of $10,000 invested in 2005: $26,759
Ten-Year Annualized Return: 10.34%
Net Assets: $6.09 Billion
Investment Style: Health
#2. QQQ – PowerShares QQQ ETF
Current value of $10,000 invested in 2005: $27,955
Ten-Year Annualized Return: 10.83%
Net Assets: $36.9 Billion
Investment Style: Large Growth
#1. IBB – iShares Nasdaq Biotechnology
Current value of $10,000 invested in 2005: $39,982
Ten-Year Annualized Return: 14.86%
Net Assets: $7.74 Billion
Investment Style: Health
This article was syndicated from Business 2 Community: The Most Successful ETFs of All Time
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