The top 10 most-purchased ETFs in June 2023
4th July 2023 13:17
by Kyle Caldwell from interactive investor
Passive fans have been increasing exposure to technology stocks in the hope that advancement in artificial intelligence (AI) will be a long-term winning theme.
In common with investors in the most-popular funds and investment trusts in June, those buying exchange-traded funds (ETFs) also increased their US technology exposure.
Excitement over the potential of artificial intelligence (AI) to transform various industries has sent share prices higher for companies perceived to be the winners, particularly the technology giants.
- Invest with ii: Top ISA Funds | FTSE Tracker Funds | Open a Stocks & Shares ISA
The Invesco EQQQ Nasdaq 100 Uctis ETFclimbed two places up the rankings to seventh place. It entered the top 10 in May. The ETF tracks the 100 largest companies listed on the Nasdaq. This index is tech-heavy and often taken as a proxy for the performance of US tech in general.
For investors looking to gain dedicated exposure to the AI theme, there are a small number of specialist options, which will no doubt increase if the theme continues to take off. The main ETF route is the L&G Artificial Intelligence ETF (LSE:AIAI).
However, bear in mind that if you have exposure to a global or US fund - active or passive - the likelihood is that you will already have exposure to AI, due to most funds having exposure to the tech giants listed in the US.
In terms of ETFs, the most popular one in June, the Vanguard S&P 500 Ucits ETF (distributing), has plenty of exposure to the ‘big seven’, namelyMicrosoft (NASDAQ:MSFT), Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN), Meta Platforms (NASDAQ:META), Tesla (NASDAQ:TSLA), Alphabet (NASDAQ:GOOGL) and NVIDIA (NASDAQ:NVDA).
Big tech exposure can also be achieved through the accumulation share class of the Vanguard S&P 500 ETF.
Some investors are seeking to profit if the AI hype does not live up to expectations. The WisdomTree NASDAQ 100 3x Daily Leveraged Short ETP is a new entry into our top 10 in June, entering in 10th place. It seeks to profit when the Nasdaq 100 Total Return Index falls.
It is therefore much more riskier than a normal ETF. 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.
The other new entry to our top 10 is the Lyxor Smart Overnight Return ETF. This fund aims to give investors cash-like returns via capital growth instead of income. It has appeared in the top 10 a couple of times this year.
- The index funds and ETFs that active funds struggle to beat
- Ask ii: what is the best way to invest passively in the US stock market?
- Four reasons why bond ETFs are attracting attention
Elsewhere, the same trends of demand for global and UK exposure via ETFs continues to play out. For the former, the preferred options are the iShares Core MSCI World Ucits ETFand the Vanguard FTSE All World ETF.
While for the UK, the most popular options are the iShares Core FTSE 100 Ucits ETFand the Vanguard FTSE 100 ETF (distributing).
Also continuing to feature in the top, but slipping down four places in the rankings, is the iShares Physical Gold ETC.
The Vanguard FTSE All World High Dividend Yield ETFand WisdomTree FTSE 100 3x Daily Leveraged ETF both exited the top 10.
Top 10 most-popular ETFs in June 2023
| Position | ETF | Change from May | One-year performance to 1 July 2023 (%) | Three-year performance to 1 July 2023 (%) |
|---|---|---|---|---|
| 1 | Vanguard S&P 500 ETF (distributing) | No change | 11.4 | 45.5 |
| 2 | iShares Core MSCI World ETF | Up one | 11.4 | 38.1 |
| 3 | iShares Core FTSE 100 ETF | Down one | 9 | 36.1 |
| 4 | Vanguard FTSE All-World ETF | Up one | 9.5 | 33.2 |
| 5 | Vanguard S&P 500 ETF (accumulating) | Up two | 11.4 | 45.5 |
| 6 | Lyxor Smart Overnight Return ETF | New entry | 3.3 | 3.9 |
| 7 | Invesco EQQQ Nasdaq 100 ETF | Up two | 24.3 | 46.4 |
| 8 | iShares Physical Gold ETC | Down four | 0.3 | 5.1 |
| 9 | Vanguard FTSE 100 ETF (distributing) | Down one | 9 | 36 |
| 10 | WisdomTree Nasdaq 100 3x Daily Short ETF | New entry | -68.3 | -89.4 |
Source: FE FundInfo/interactive investor, 1 June. Note: the top 10 is based on the number of “buys” during the month of June.
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.