Online Retail ETFs to Benefit from the Holiday Shopping Craze
The coronavirus pandemic has helped the e-commerce industry gain a firm foothold in the United States and around the world as people have stayed in and purchased all the essentials online. The trend is expected to continue into the next holiday season. According to Mastercard SpendingPulse, retail sales in the United States – excluding cars and gas – for the “75 days of Christmas” which runs from October 11 to December 24 – are expected to increase 6.8% year over year.
Along with the trend of digitization, the upcoming holiday season in the United States is expected to see a significant increase in online sales. Mastercard SpendingPulse predicts online sales to increase 7.5% during the “75 Days of Christmas” period. In fact, eMarketer predicts that revenue for the 2021 holiday season will increase 11.3% year-over-year to $ 206.88 billion, according to a Whiplash article.
The current wave of digitalization favors both e-commerce pureplays and traditional retailers, who are entering e-commerce to take advantage of the boom in online shopping. At the same time, merchants are moving towards a hybrid / omnichannel model so that customers can enjoy fast delivery, or pick up ordered items online (BOPIS, curbside pickup), at their convenience, and via apps. who organize personal buyers. The trend is a boon for a number of retail players, motivating them to expand their omnichannel offerings.
Retailers are increasingly adopting the “buy now, pay later” model to attract buyers in an environment of higher retail prices. By Salesforce, global “buy now, pay laterService is expected to account for 8% of online orders this shopping season.
Retailers are gearing up for the start of the holiday season (end of October-December) which is considered a busy season for many industry players and market participants. The quarter is also marked by some popular retail events like Halloween, Thanksgiving, Cyber Monday, Black Friday and Christmas which are increasing its importance among retailers. Based on data from Sensormatic Solutions, Black Friday (November 26) is estimated to be the busiest shopping day this year.
According to the Shopkick 2021 survey, 57% of customers are considering opting for online support to meet their shopping needs (as mentioned in a Whiplash article). The increase in COVID-19 cases due to the Delta variant could also boost online shopping preference. Consumers might prefer to shop indoors to follow social distancing measures and take precautions. In addition, this new online shopping habit has provided consumers with great convenience, as all their shopping needs, especially food products, toys and household electronics, can be purchased with just one click.
Online retail ETFs to continue to shine
In this context, let’s take a look at some ETFs that may benefit from the new shopping trend:
Amplify Online Retail ETFs I BUY
The fund offers investors a profitable way to own a basket of companies that earn significant income from online or virtual retail sales. With assets under management of $ 915.7 million, the fund has an expense ratio of 65 basis points (bps) (read: 5 ETF areas for investors to consider amid the September crisis).
ProShares Long Online / Short Stores ETF CLIX
The fund seeks investment results, before fees and expenses, that match the performance of the ProShares Long Online / Short Stores index. With an AUM of $ 71.8 million, the fund has an expense ratio of 65 basis points (read: Long / Short ETFs to fight against the probable fall of the market in September).
ProShares Online Retail ETFs ONLN
The fund seeks investment results, before fees and expenses, that track the performance of the ProShares Online Retail Index. With assets under management of $ 839.8 million, the fund has an expense ratio of 58bp (read: Retail ETFs Are Good Bets: Let’s Explore Why).
Global Ecommerce ETF X EBIZ
The fund seeks to invest in companies positioned to benefit from the increased adoption of e-commerce as a distribution model, including companies primarily engaged in operating e-commerce platforms, providing software and marketing services. e-commerce and / or to sell goods and services. in line. With assets under management of $ 200.5 million, the fund has an expense ratio of 50 basis points.
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