After reaching a record high on optimism surrounding corporate growth under President-elect Donald Trump, all three major bourses lost momentum as sticky inflation and the Fed’s hawkish comments weighed on investors’ sentiment. In fact, the S&P 500 Index gave up about a third of the index’s post-election rally.

We have highlighted five top-performing ETFs from different sectors that were the leaders over the past month. These are AdvisorShares Psychedelics ETF PSIL, Simplify Volt Robocar Disruption and Tech ETF VCAR, First Trust SkyBridge Crypto Industry & Digital Economy ETF CRPT, U.S. Global Jets ETF JETS and First Trust NASDAQ ABA Community Bank Index Fund QABA.

Current Market Trends

The market is betting that the second Trump administration will provide a boost to stocks, given his more market-friendly policies. Trump's policies on restricting illegal immigration, enacting new tariffs, lowering taxes and reducing regulations may boost the economy but also accelerate inflation, limiting the Federal Reserve's ability to cut rates. The anticipation of greater tariff barriers and a step to move manufacturing back home is expected to drive stocks higher (read: 5 Sector ETFs to Gain Under Trump Presidency).

Federal Reserve Chair Jerome Powell, in the latest meeting, slashed interest rates for the second time this year. The key interest rate was cut by 25 bps, bringing down the benchmark rate to 4.5%-4.75%, following the 50-bps cut in September 2024. Lower interest rates generally lead to reduced borrowing costs, helping businesses to expand their operations more easily and resulting in increased profitability. This, in turn, stimulates economic growth and provides a boost to the stock market.

However, Powell signaled yesterday that the central bank is not in a hurry to slash rates, given signs of strength in the U.S. economy. Fed funds futures trading reflects a decline in odds for a quarter-point cut at the December meeting, sliding to about 62%. This is down from 82.5% earlier in the day.

Let’s dig into the details of the abovementioned ETFs:

AdvisorShares Psychedelics ETF (PSIL) – Up 77%

AdvisorShares Psychedelics ETF invests in the emerging psychedelic drugs sector, offering exposure to those biotechnology, pharmaceutical and life sciences companies, which AdvisorShares sees as leading the way in this nascent industry. It is an actively managed fund and holds 26 stocks in its basket with a heavy concentration on the top firm. AdvisorShares Psychedelics ETF has accumulated $6.4 million in its asset base and charges 99 bps in annual fees. It trades in an average daily volume of 32,000 shares. 

Simplify Volt Robocar Disruption and Tech ETF (VCAR) – Up 59.5%

Simplify Volt Robocar Disruption and Tech ETF is an actively managed ETF offering direct exposure to Tesla’s market-leading innovation across various high-growth sectors, including EVs, robotics, AI and renewable energy. It concentrates on Tesla-related instruments, including common stock, ETFs, swaps and options, to capture the growth potential of Tesla as a leader in electric vehicles and sustainable technologies (read: Should You Buy Tesla ETFs on $1 Trillion Comeback?).

Simplify Volt Robocar Disruption and Tech ETF charges investors 0.95% in annual fees and trades in average daily volume of 6,000 shares. It has accumulated $6 million in its asset base. 

First Trust SkyBridge Crypto Industry & Digital Economy ETF (CRPT) – Up 44.1%

First Trust SkyBridge Crypto Industry and Digital Economy ETF is designed to provide exposure to companies that SkyBridge believes are driving cryptocurrency, crypto assets and digital economy-related innovation. SkyBridge identifies securities primarily via “bottom-up” research focused on finding companies leading in the crypto industry ecosystem. 

First Trust SkyBridge Crypto Industry & Digital Economy ETF holds 35 stocks in its basket and charges 85 bps in fees per year from investors. It has amassed $78.3 million in its asset base and trades in an average daily volume of 57,000 shares.

U.S. Global Jets ETF (JETS) – Up 15.8%

U.S. Global Jets ETF provides exposure to the global airline industry, including airline operators and manufacturers from all over the world, by tracking the U.S. Global Jets Index. The product holds 57 securities and charges 60 bps on an annual basis (read: Travel & Entertainment ETFs at a 52-Week High: Here's Why). 

U.S. Global Jets ETF has gathered $1.1 billion in its asset base while seeing a heavy trading volume of nearly 3 million shares a day. JETS has a Zacks ETF Rank #3 (Hold) with a High risk outlook. 

First Trust NASDAQ ABA Community Bank Index Fund (QABA) – Up 14.5%

First Trust NASDAQ ABA Community Bank Index Fund offers exposure to the largest banks and thrifts or their holding companies that are designated as banks by the Industry Classification Benchmark. It tracks the NASDAQ OMX ABA Community Bank Index, holding 122 stocks in its basket. 

First Trust NASDAQ ABA Community Bank Index Fund has accumulated $126.8 million in its asset base and trades in a volume of around 14,000 shares a day on average. It charges 60 bps in annual fees and has a Zacks ETF Rank #4 (Sell) with a High risk outlook.

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U.S. Global Jets ETF (JETS): ETF Research Reports

First Trust NASDAQ ABA Community Bank ETF (QABA): ETF Research Reports

First Trust SkyBridge Crypto Industry and Digital Economy ETF (CRPT): ETF Research Reports

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