ETF buyers swapped the electric car theme for silver and blockchain.
ETF buyers on interactive investor snapped up silver in February, according to the most-bought ETF data for February 2021. As the table below shows, both iShares Physical Silver ETC (LSE:ISLN) and WisdomTree Physical Silver ETC (LSE:PHAG) were new entrants, with the former being the fourth most-bought ETF on the platform for the month.
As we reported at the start of February, following the drama over GameStop (NYSE:GME) in January, some Reddit traders turned their eye to silver. As a result, the price of silver hit highs not seen for years.
- Will these Buffett-style ‘moat’ ETFs protect against inflation?
- This ETF lets you track tech chip sector – but it’s very boom and bust
- New hydrogen economy ETF launches – too late to back this theme?
However, it is important to note that there is a reasonable case for silver beyond a frenzy of social media-induced buying. As many have pointed out, climate-friendly policies are resulting in increased demand for solar panels, electric vehicles and battery cells – and silver is a key component of these products.
Another popular asset class in February was bitcoin and other cryptocurrencies. Interactive investor does not offer direct exposure, but there are plenty of ways to indirectly gain exposure, including the Invesco Elwood Blockchain ETF (LSE:BCHN), which was the third most-popular ETF in February.
The ETF uses the Elwood Blockchain Global Equity index to track a basket of companies deemed to have the “potential to participate in the blockchain ecosystem”. The ETF’s one-year performance is a staggering 148.5%.
Partly that is the result of some of its very-bitcoin related holdings. However, the ETF also includes many more conventional stocks names. For instance, among its largest holdings are tech hardware firms Taiwan Semiconductor Manufacturing (NYSE:TSM) and Samsung (LSE:SMSD), financial services companies Mitsubishi UFJ Financial Group (NYSE:MUFG) and Banco Santander SA (LSE:BNC) as well as the FTSE 100 mining giant Rio Tinto (LSE:RIO). So while some holdings may move up or down with the price of bitcoin, the share price of some its large holdings are largely unrelated to cryptocurrency movements.
Electric car and battery thematic ETFs fell out of favour. In January, the L&G Battery Value Chain ETF (LSE:BATT) and WisdomTree Battery Solutions ETF (LSE:VOLT) were both included in the rankings, with investors attracted to the strong recent performance of electric car makers such as Tesla (NASDAQ:TSLA) and Chinese rival Nio (NYSE:NIO). That excitement, however, seems to have dissipated, with both ETFs falling out of the top 10 in February.
- Revealed: the ETFs charging active manager fees
- Tom Bailey Column: Help! I believe in passive but buy active funds
- Take control of your retirement planning with our award-winning, low-cost Self-Invested Personal Pension (SIPP)
Investors carried on buying the FTSE 100, with the iShares Core FTSE 100 ETF (LSE:ISF) keeping its place as the second most-bought ETF. The Vanguard FTSE 100 ETF (LSE:VUKE) slipped down the ranking slightly to sixth place. The extremely bullish carried on buying the highly risky WisdomTree FTSE 100 3x Daily ETF (LSE:3UKL), which gives investors triple the return of the blue-chip index.
Investors also continued to buy iShares Global Clean Energy ETF (LSE:INRG). This ETF was one of the best performing in 2020. Since then, performance has started to calm slightly, however, its one-year performance still sits at an impressive 83%.
Top 10 most-purchased ETFs in February 2021
|ETF||Change from November||One-year performance to 1 March (%)||Three-year performance to 1 March (%)|
|1||iShares Global Clean Energy ETF||No change||83||181.2|
|2||iShares Core FTSE 100 ETF||No change||-4.9||-0.2|
|3||Invesco Elwood Global Blockchain ETF||New entrant||148.5|
|4||iShares Physical Silver ETC||New entrant||36||57.8|
|5||iShares Physical Gold ETC||-1||-1.7||29.4|
|6||Vanguard FTSE 100 ETF||-3||-5||-0.3|
|7||WisdomTree FTSE 100 3x Daily||-1||-31.4||-33.3|
|8||Vanguard S&P 500 ETF||-1||13.6||40.7|
|9||WisdomTree Physical Silver ETC||New entrant||35.7||57.2|
|10||Vanguard FTSE 250 UCITS ETF||-1||3.3||13.3|
Source: interactive investor. Note: the top 10 is based on the number of “buys” during the month of February.
These articles are provided for information purposes only. Occasionally, an opinion about whether to buy or sell a specific investment may be provided by third parties. The content is not intended to be a personal recommendation to buy or sell any financial instrument or product, or to adopt any investment strategy as it is not provided based on an assessment of your investing knowledge and experience, your financial situation or your investment objectives. The value of your investments, and the income derived from them, may go down as well as up. You may not get back all the money that you invest. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.
Full performance can be found on the company or index summary page on the interactive investor website. Simply click on the company's or index name highlighted in the article.