A digital currency fund was the big performance winner in May, while semiconductor ETFs also outperformed the S&P 500 by a wide margin.
Bitcoin Investment Trust ( GBTC ) came out on top with a 251.5% return, according to Morningstar Inc. By comparison, the S&P 500 climbed 1.4% as the benchmark index marked new record highs in the last week of May.
The $396.2 million Bitcoin fund is trading at a huge premium to the digital currency, which was trading at record highs above the $2,400 level Thursday. While the price of Bitcoin has skyrocketed, the number of shares outstanding has remained fairly stable since the fund's September 2013 launch.
[ibd-display-video id=449449 width=50 float=left] "Grayscale Investments' Bitcoin Investment Trust is trading at a large premium to its underlying Bitcoin holdings as investors are eager to get long Bitcoin exposure but are wary of owning the actual asset," S3 Research said in a May 31 report. "With very little institutional ownership in GBTC there is very little stock in lending programs and total short interest has never been over 20,000 shares or $2 million until this month when short interest increased to 32,000 shares or $15 million."
Coming in second was iPath Bloomberg Cocoa Subindex Total Return ETN ( NIB ), up 12.2% in May. The ETN is coming off of an April bottom as cocoa prices recover from a slump triggered by a supply glut.
Three semiconductor funds made the top 10 as leading chip stocks rallied to new highs. SPDR S&P Semiconductor ( XSD ) and iShares PHLX Semiconductor ( SOXX ) tied with an 8.7% gain for the month. VanEck Vectors Semiconductor ( SMH ) followed close behind with a 7.9% advance. Further down the list, behind several non-semiconductor ETFs, was PowerShares Dynamic Semiconductors (PSI), up 6.5%, which just missed the top 10.
All four ETFs owned graphics chip designer Nvidia (NVDA) and Micron Technology (MU) in their top 10 holdings.
XSD is near the top of a buy range from a 61.91 flat-base entry cleared in mid-May. SOXX is extended from a 138.06 flat-base buy point. SMH and PSI are extended after an April bounce off their 50-day moving-average lines.
Other top performers included iShares MSCI South Korea Capped (EWY), iShares Austria Capped (EWO) and Global X MSCI Greece (GREK) with respective gains of 9.1%, 8% and 7.7%. Global X Social Media (SOCL) made the cut with a 7.3% advance.
SOCL is far extended from a 24.94 cup-with-handle buy point initially cleared in March. The $126.9 million fund, which counted Tencent (TCEHY), Twitter ( TWTR ) and Facebook (FB) among its top holdings, has a five-year annualized return of 17.3%. That's slightly ahead of the S&P 500's 15.4% return.
First Trust STOXX European Select Dividend Index (FDD), up 6.8% for the month, rounded out the top 10 ETFs. The fund, which has attracted $428.1 million in assets, tracks the STOXX Europe Select Dividend 30 Index. Its biggest country weightings as of May 31 were the U.K. at about 29% of assets, France at 21% and Switzerland at 14.7%.
BlackRock is bullish on global equity markets going forward.
"Global stocks have been on a tear lately, and many investors are questioning if this can last," BlackRock's Global Chief Investment Strategist Richard Turnill wrote in a May 30 report. "We see further, albeit more muted, gains ahead as an increasingly broad-based rally is backed by strong earnings and global reflation."
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