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June 19, 2021, 1:36 p.m. EDT

ETFs to turn to as Fed sets stock market up for rising inflation and interest rates; GameStop heads to IWF

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By Mark DeCambre

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Fidelity rolls out trio of ETFs

Fidelity recently launched three actively managed ETFs. Fidelity Preferred Securities & Income ETF /zigman2/quotes/227464298/composite FPFD +0.02% on Cboe Global Markets, and Fidelity Sustainability U.S. Equity ETF /zigman2/quotes/227464314/composite FSST -0.95%  and Fidelity Women’s Leadership ETF /zigman2/quotes/227464279/composite FDWM -1.44% both on the Intercontinental Exchange-owned /zigman2/quotes/209108507/composite ICE -0.78% New York Stock Exchange’s Arca platform.

Greg Friedman, Fidelity’s head of ETF management and strategy, told MarketWatch via email that the preferred securities ETF, managed by Adam Kramer and Brian Chang, may offer some benefits to investors seeking more income than traditional fixed-income products.

“Generally, preferred securities offer more income than traditional investment grade bonds and higher quality than high-yield bonds, with less volatility than equities,” he said.

“Just as beneficial, during periods of rising rates, some types of preferred income securities, such as fixed-to-floating rate, are less sensitive to the same negative price pressure that most bonds experience,” Friedman said.

Is there a bitcoin ETF?

No.

But there’s news and it could be interpreted a couple of ways.

The Securities and Exchange Commission on Wednesday  delayed a decision  on approving a bitcoin ETF from ETF provider VanEck, marking the second time it has done so since April.

The SEC wants to understand whether the proposed VanEck Bitcoin ETF would be susceptible to manipulation, or whether notably its underlying assets would be , and whether any single market participant would have “the ability to buy or sell large amounts of bitcoin without significant market impact,” it said in its announcement .

We reached out the VanEck folks on Wednesday who had this to say: “VanEck continues to believe investors will be well served by having a publicly registered Bitcoin product and we’re committed to working with regulators during their period of consideration.”

One read of the SEC’s move is that it is reluctant to move forward with a bitcoin ETF this year and thinks that not much has changed to alter its concerns on digital assets underpinning an ETF. Another way to think about this statement is that the SEC is methodically attempting to get comfortable with this asset and is hyper concerned about investor protections, which is something that newly minted SEC Chairman Gary Gensler as articulated .

Tell us what you think.

The good and the bad

Top 5 gainers of the past week %Return
Amplify Transformational Data Sharing ETF /zigman2/quotes/204122720/composite BLOK 3.8
WisdomTree Cloud Computing Fund /zigman2/quotes/214057201/composite WCLD 3.8
Global X MLP ETF /zigman2/quotes/205872419/composite MLPA 3.7
Global X Cloud Computing ETF /zigman2/quotes/211334933/composite CLOU 3.1
United States Oil Fund LP /zigman2/quotes/203483736/composite USO 2.9
Source: FactSet, through Wednesday, June 16, excluding ETNs and leveraged products Includes NYSE, Nasdaq and Cboe traded ETFs of $500 million or greater
Top 5 decliners of the past week % Return
ETFMG Alternative Harvest ETF /zigman2/quotes/204332491/composite MJ -6.3
Global X Copper Miners ETF /zigman2/quotes/200953483/composite COPX -5.0
AdvisorShares Pure US Cannabis ETF /zigman2/quotes/220307682/composite MSOS -4.6
iShares Mortgage Real Estate ETF /zigman2/quotes/203780198/composite REM -4.1
iShares MSCI Global Metals & Mining Producers ETF /zigman2/quotes/203481041/composite PICK -3.2
Source: FactSet

GameStop won’t stop

GameStop boasts a $16 billion market cap, as of Thursday trade, but it had qualified for entry into a more exclusive club the Russell 1000 index /zigman2/quotes/210598144/delayed RUI -1.00% back in May, as per the annual reconstitution overseen by FTSE Russell. The rebalancing by the index provider comes as GameStop shares have soared over 1,000% so far this year, propelled by a meme stock revolution that itself has been powered by individual investors on social -media platforms like Discord and Reddit, who have coordinated to drive stocks higher and crush short sellers.

GameStop, and AMC Entertainment Holdings /zigman2/quotes/200235402/composite AMC -4.19% to an even greater degree, has been a big beneficiary of that trend, which now has implications for ETFs.

The reconstitution means that the iShares Russell 1000 Growth ETF /zigman2/quotes/202261664/composite IWF -1.67% , which aims to mimic the performance of the Russell 2000, will also be required to include GameStop on or before June 25, when the reconstitution will be completed.

The Russell 1000 Growth ETF kicked off more than two decades ago, and is one of the most popular equity ETFs and has about $66 billion in assets.

Visual of the week

Timber! Lumbers prices /zigman2/quotes/210109673/delayed LB00 -1.14% are still up 150% over the past 12 months but have buckled lately, down roughly 27% so far in May.

/zigman2/quotes/227464298/composite
US : U.S.: Cboe BZX
$ 24.80
+0.0042 +0.02%
Volume: 17,936
Dec. 3, 2021 4:10p
loading...
/zigman2/quotes/227464314/composite
US : U.S.: NYSE Arca
$ 21.52
-0.21 -0.95%
Volume: 2,742
Dec. 3, 2021 4:10p
loading...
/zigman2/quotes/227464279/composite
US : U.S.: NYSE Arca
$ 20.17
-0.30 -1.44%
Volume: 785.00
Dec. 3, 2021 4:10p
loading...
/zigman2/quotes/209108507/composite
US : U.S.: NYSE
$ 130.19
-1.03 -0.78%
Volume: 2.60M
Dec. 3, 2021 4:00p
P/E Ratio
24.06
Dividend Yield
1.01%
Market Cap
$73.93 billion
Rev. per Employee
$859,618
loading...
/zigman2/quotes/204122720/composite
US : U.S.: NYSE Arca
$ 49.72
-3.36 -6.33%
Volume: 1.38M
Dec. 3, 2021 4:00p
loading...
/zigman2/quotes/214057201/composite
US : U.S.: Nasdaq
$ 50.99
-2.49 -4.66%
Volume: 710,984
Dec. 3, 2021 4:00p
loading...
/zigman2/quotes/205872419/composite
US : U.S.: NYSE Arca
$ 33.64
-0.22 -0.65%
Volume: 199,950
Dec. 3, 2021 4:10p
loading...
/zigman2/quotes/211334933/composite
US : U.S.: Nasdaq
$ 26.70
-0.70 -2.55%
Volume: 1.08M
Dec. 3, 2021 4:00p
loading...
/zigman2/quotes/203483736/composite
US : U.S.: NYSE Arca
$ 48.00
-0.29 -0.60%
Volume: 10.86M
Dec. 3, 2021 4:00p
loading...
/zigman2/quotes/204332491/composite
US : U.S.: NYSE Arca
$ 11.33
-0.38 -3.25%
Volume: 1.41M
Dec. 3, 2021 4:00p
loading...
/zigman2/quotes/200953483/composite
US : U.S.: NYSE Arca
$ 35.14
-0.44 -1.24%
Volume: 3.09M
Dec. 3, 2021 4:00p
loading...
/zigman2/quotes/220307682/composite
US : U.S.: NYSE Arca
$ 26.49
+0.03 +0.11%
Volume: 3.66M
Dec. 3, 2021 4:00p
loading...
/zigman2/quotes/203780198/composite
US : U.S.: Cboe BZX
$ 35.53
-0.40 -1.11%
Volume: 632,830
Dec. 3, 2021 4:10p
loading...
/zigman2/quotes/203481041/composite
US : U.S.: Cboe BZX
$ 40.62
-0.79 -1.91%
Volume: 206,248
Dec. 3, 2021 4:10p
loading...
/zigman2/quotes/210598144/delayed
US : US Composite
2,523.03
-25.51 -1.00%
Volume: 4.06M
Dec. 3, 2021 8:01p
loading...
/zigman2/quotes/200235402/composite
US : U.S.: NYSE
$ 29.01
-1.27 -4.19%
Volume: 66.19M
Dec. 3, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
$15.56 billion
Rev. per Employee
$43,642
loading...
/zigman2/quotes/202261664/composite
US : U.S.: NYSE Arca
$ 292.61
-4.97 -1.67%
Volume: 1.70M
Dec. 3, 2021 4:00p
loading...
/zigman2/quotes/210109673/delayed
US : U.S.: CME
$ 904.10
-10.40 -1.14%
Volume: 344.00
Dec. 3, 2021 3:04p
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