interactive investor customers stuck to ‘core’ ETFs in December as stock markets fell.
There was just one new entry on the most-purchased exchange-traded fund (ETF) list in the final month of 2022, as investors stuck to their favourite tracker funds in December.
However, there was plenty of shuffling among the 10 most-popular ETFs, as ETFs tracking major markets and seen as “core” investments rose up the charts.
The iShares Core FTSE 100 Ucits ETF went from third to second place, nestling in behind long-term favourite Vanguard S&P 500 Ucits ETF (distributing), while Vanguard FTSE All-World Ucits ETF rose two places to fourth, and Vanguard S&P 500 Ucits ETF (accumulating) and iShares Core MSCI World Ucits ETF both rose one place to sixth and seventh. Vanguard FTSE 100 Ucits ETF (distributing) fell one place to 10th.
The two global ETFs have subtle differences. The iShares ETF, from BlackRock, excludes emerging markets. It therefore has no China exposure and owns around 1,500 stocks, costing 0.2% in fees a year.
Vanguard’s popular global ETF is an “all world” tracker and includes emerging markets. It owns around 3,750 shares, with 3% invested in China. It costs 0.22% a year in fees.
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ETFs tracking the UK market took a rare win over US shares in 2022. The FTSE index, including dividends, rose 5%, while the S&P 500 fell 9% in sterling terms. Global shares, which are dominated by US companies, fell 8% in 2022.
The new entry in December was WisdomTree FTSE 100 3x Daily Leveraged Long, in ninth place. There were three other leveraged ETFs in the most-bought list: WisdomTree Nasdaq 100 3x Daily Leveraged Short (down four places to eighth); WisdomTree FTSE 100 3x Daily Leveraged Short (down three places to fifth); and WisdomTree Nasdaq 100 3x Daily Leveraged (up two places to third).
These ETFs use financial contracts to amplify the gains – and losses – of a stock market. They are therefore much riskier than normal ETFs, and investors should do their homework before buying one of them.
The promotional literature of many leveraged products specifies that they should not be held for more than one day, and our article explains why in more detail.
Top 10 most-popular ETFs in December 2022
|Rank||ETF||Change from November||One-year performance to 3 January 2023 (%)||Three-year performance to 3 January 2023 (%)|
|1||Vanguard S&P 500 Ucits ETF (distributing)||No change||-8.1||34.5|
|2||iShares Core FTSE 100 Ucits ETF||Up one||4.7||8.7|
|3||WisdomTree Nasdaq 100 3x Daily Leveraged||Up two||-76.1||14.8|
|4||Vanguard FTSE All-World Ucits ETF||Up two||-7.8||22.3|
|5||WisdomTree FTSE 100 3x Daily Leveraged Short||Down three||-22.5||-63|
|6||Vanguard S&P 500 Ucits ETF (accumulating)||Up one||-8.1||34.5|
|7||iShares Core MSCI World Ucits ETF||Up one||-7.7||26.1|
|8||WisdomTree Nasdaq 100 3x Daily Leveraged Short||Down four||30.5||-60|
|9||WisdomTree FTSE 100 3x Daily Leveraged Long||New entry||0.8||-22.7|
|10||Vanguard FTSE 100 Ucits ETF (distributing)||Down one||4.6||8.5|
Source: Fe FundInfo/interactive investor, 3 January 2023. Note: the top 10 is based on the number of “buys” during the month of December.
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