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Bitcoin Soars; Chip ETFs Also Among Top Performers In May


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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."

RELATED:

What Fidelity's Abigail Johnson Has To Say About Bitcoin And Blockchain

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.



This article appears in: Investing , ETFs
Referenced Symbols: GBTC , NIB , XSD , SOXX , SMH


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