As high-profile tech stocks grab headlines and social media timelines, a stealthy rally is simmering in the shadows. On July 30, four under-the-radar ETFs, each with vastly dissimilar themes, established new 52-week highs, as noticed by Barchart. But this was no accident or anomaly.
What they appear to “know” is how to avoid the standard indexing fare and surf smarter, more focused approaches through a messy macro landscape.
Also Read: The $5 Billion Copper Trap: How One ETF Got Burned By Trump’s Surprise Tariff Move
From cash-proxy plays to innovation-led disruptors, all of these smart-beta ETFs have one thing in common (apart from the word “Alpha”): they invest in rules-based, factor-based, or actively managed approaches that are programmed to pull performance out in ways the broad market is just starting to understand.
In short, they’re quietly succeeding because they’re architecturally designed to do so when volatility, rate regimes or leadership in the market begin to change.
Get to know the Smart Beta Squad:
Alpha Architect 1-3 Month Box ETF (BATS:BOXX)
What it does: Uses options box spreads to mimic the return profile of short-term Treasurys.
Why it’s up: With the Fed in no rush to cut rates, BOXX offers juicy, low-risk yield, making it a haven for cash-rich, risk-averse investors looking to do better than money market funds.
First Trust Utilities AlphaDEX ETF (NYSE:FXU)
What it does: Picks utilities stocks using AlphaDEX’s factor methodology (think growth, value, and momentum).
Why it’s increasing: Utilities are getting their moment due to solid demand, record heat waves and increased demand for defensives as economic uncertainty looms. The smart beta spin adds an extra dimension to FXU’s ability to pick the right horses in this slow-and-steady race.
First Trust Multi Cap Growth AlphaDEX Fund (NASDAQ:FAD)
What it does: Implements a similar smart beta strategy on large-, mid- and small-cap growth equities.
Why it’s rising: As investor interest expands beyond megacaps, multi-cap growth is making a comeback, and FAD’s factor-driven selection enables it to identify the winners in this underdog rotation.
Spear Alpha ETF (NASDAQ:SPRX)
What it does: Actively managed fund focused on disruptive tech: AI, semiconductors, robotics, and even space.
Why it’s on the rise: With innovation winds still at large, especially with respect to AI and chips, SPRX has profited from being early on names that mainstream ETFs tend to avoid.
In spite of their diversity, these four ETFs are made from the same stuff: they eschew vanilla market cap approaches. Whether through option-based income engineering (BOXX), smart beta screening (FXU, FAD) or active innovation hunting (SPRX), they all utilize alternative indexing techniques in order to tap returns where others are too late, or too indifferent, to bother.
Read Next:
Photo: Ole.CNX via Shutterstock
