Sign in or Register

Already a member?

Sign in

Or sign in with your account on:

Not a member yet?



ETFs for Making an Online Retail Play

By  +Follow December 5, 2013 12:53PM
Tickers Mentioned:

The data’s back and Cyber Monday was the biggest online shopping day in history. Again. In a continuation of a trend that shocks almost exactly no one anymore (unless you’re one of the poor saps who’s held a long position on JC Penney (JCP) over the last couple years), online retail continues to grow at a fairly explosive rate.

Online sales were up 20.6 percent, year-over-year, from 2012’s Cyber Monday according to IBM’s (IBM) Digital Analytics. Adobe (ADBE) , meanwhile, only reported a 16 percent increase, according to their data, but clocked $2.29 billion in total sales. That’s dwarfed by the $12.3 billion in sales at brick and mortar retailers on Black Friday and Thanksgiving, but the trend of online retailers claiming an ever bigger piece of the pie appears to be here to stay.

So, maybe you’re on board with believing that Amazon’s (AMZN) plans for world domination are legit. Or, maybe you think the fervor over the growth in online sales has led to those stocks being severely overvalued and on course for a major correction. However you see the market playing out, one has ample reason to look for ETFs that will provide an investor a chance to make their particular online retail play.

There is not currently an ETF dedicated to online retailers like the SPDR S&P Retail ETF ($XRT) tracks traditional retailers. However, for those willing to get creative, there are a few ETFs one can use to make place a bet on the health of the online retail segment.

SPDR S&P Retail ETF ($XRT)

While this ETF is specific to traditional retailers, it’s worth noting that online sales aren’t limited to just Amazon, EBay (EBAY) , and other dedicated online retailers. Most traditional brick-and-mortar stores are actively building out their online capacity, and it’s not hard to make the argument that investing in those companies will gradually evolve into an investment in online retail at a rate consistent with that of the market. What’s more, the piece of the online pie that’s there doesn’t come at the price of completely eschewing the rest of the retail industry.

Market Vectors Retail ETF ($RTH)

If you’re a fan of the argument for XRT, though, the Market Vectors Retail ETF is potentially a superior blend. The RTH includes major retailers like Wal-Mart (WMT) , Home Depot (HD) , and CVS Caremark (CVS) among its five biggest holdings. However, it also features Amazon as its single biggest holding at 9.55 percent of its portfolio. Again, this is a blend that should capture a big piece of both the brick-and-mortar and online retail pie.

First Trust Dow Jones Internet Index Fund ($FDN)

However, many investors may not want any part of the traditional retail stocks. If you’re really intent and making a more specific and targeted play with online retail and staying away from any ailing brick-and-mortar dinosaurs, one option could be the First Trust Dow Jones Internet Fund. Based on the Dow Jones Internet Index, all of the companies that receive at least half of their annual sales/revenue from the internet.

This may keep things strictly online, but it also means that it’s no longer strictly retailers, too. Amazon is the second largest holding, but Google (GOOG) is the biggest at 11.18 percent and Facebook (FB) is the third largest with 6.45 percent of the portfolio.

Internet HOLDRS ($HHH)

So, if one really wants to get more specific, the Internet HOLDRS ETF may be the way to go. Like other HOLDRS funds, it’s much smaller, featuring only 12 stocks and not tracking a specific index as a benchmark. Amazon makes up 43.03 percent of the fund, and EBay is another 22.83 percent.

Just Buy (or Short) Amazon

Of course, once you’re talking about an ETF with no index and only 12 holdings, with two stocks making up 65 percent of the portfolio, it starts to become unclear why one’s looking for ETFs at all. Online is still a fairly narrow industry, with only a handful of major players that are publicly traded. While clearly much riskier than an ETF, anyone really intent on making a specific play on online retail may be best served by taking long or short positions with Amazon or EBay.

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Liked What You Read? Join Equities.com as a contributor and get eyeballs on your content FOR FREE!

Results for amzn
4 Oct 15 05:25:00
RT @NASDAQPlays: http://t.co/dObsQpGB8p covers all your favorite #NASDAQ stocks - join our email list today - $AAPL, $FB, $AMZN http://t.co…
4 Oct 15 05:13:59
$AMZN 5 Top Consumer Goods Stocks to Buy In October http://t.co/3IPkXFMjCA
4 Oct 15 05:02:42
http://t.co/dObsQpGB8p covers all your favorite #NASDAQ stocks - join our email list today - $AAPL, $FB, $AMZN http://t.co/LyTy7k2ey5
CopyTrade FX Signals
4 Oct 15 05:01:34
AMZN short $AMZN http://t.co/JvrYrKF5bo ~ via http://t.co/Kd2qwcsyit
TV_Trading Ideas
4 Oct 15 05:00:32
AMZN short $AMZN http://t.co/FKsr89LkjF
4 Oct 15 05:00:32
$AMZN chart: AMZN short. http://t.co/2WL8nHFsuq
Consumer News
4 Oct 15 04:35:54
http://t.co/6pon8AUWvO Downgraded by Zacks to Hold $AMZN http://t.co/xSWWSKWLtm #acn
4 Oct 15 03:58:58
Rumored suitor AMC Networks may not be the only player interested in #Starz. http://t.co/sLP9Ekq3SQ $AMCX $STRZA $AMZN $LGF #mna #media
4 Oct 15 03:54:18
Dubli #Shopping #travel , start saving with cash back up to 35% . FREE http://t.co/hTlS4rY1PB $SPY, $AAPL $AMZN
4 Oct 15 03:32:08
RT @upstocks13: Lesson #10 : Type of gaps http://t.co/JnGG4NRbjl $FB $TSLA $AMZN
4 Oct 15 03:00:12
#Tech #earnings dates: $INTC (Oct 13), $GOOGL & $NFLX (Oct 14), $AAPL (Oct 19), $AMZN (Oct 21), $MSFT (Oct 22), $FB (Oct 26), $CSCO (Nov 10)
Aziz Saba
4 Oct 15 02:54:21
Lesson #10 : Type of gaps http://t.co/JnGG4NRbjl $FB $TSLA $AMZN
James DiPlata
4 Oct 15 02:21:49
RT @dubli24cash: Get cash back when you shop with Dubli. #FREE Membership http://t.co/hTlS4rY1PB $SPY, $AAPL $AMZN
Rosner Stocks
4 Oct 15 01:34:15
$DIA Short Sales Updated Sunday, October 4, 2015 03:59:23 AM $BLTA $HD $AMZN $AXP http://t.co/6OqLx25Q1u
Rosner Stocks
4 Oct 15 01:34:14
$DBC Percent Change Updated Sunday, October 4, 2015 03:59:23 AM $AMZN $TSLA $XLU $AMZN http://t.co/VdXXaMB6Ti
4 Oct 15 01:23:40
$DBA Company Info Updated Sunday, October 4, 2015 04:07:20 AM $HPQ $MVG $AMZN $UPRO http://t.co/qbg3GUxE9X
4 Oct 15 01:23:37
$AEZS Opinions Updated Sunday, October 4, 2015 04:07:20 AM $SBUX $XLE $AMZN $F http://t.co/REDyD47VMi
4 Oct 15 01:19:22
Get cash back when you shop with Dubli. #FREE Membership http://t.co/hTlS4rY1PB $SPY, $AAPL $AMZN
Rosner Stocks
4 Oct 15 00:34:18
$DEPO Reviews Updated Sunday, October 4, 2015 02:59:25 AM $AMZN $BBRY $TSLA $XLB http://t.co/yAGqd3WkT9
3 Oct 15 23:22:40
$WFC News Updated Sunday, October 4, 2015 02:07:21 AM $TZA $AMZN $BAX $XLU http://t.co/qhnPGBKhmQ
Mark Yusko
3 Oct 15 22:42:00
RT @OMillionaires: #FANG Performance YTD : $FB $AMZN $GOOGL $NFLX $SPX $SPY http://t.co/fPTCYBIoW1
Stock Rocket
3 Oct 15 21:47:31
Our Platinum Members Have Been Seeing MASSIVE Gains On Our Penny Stock Picks! Subscribe Today: http://t.co/ro7o3SYbd1 $AMZN $QCOM $CSCO
3 Oct 15 21:46:54
Our Pick On $HCTI More Than Tripled For Our Members, In 3 Weeks! Subscribe For Our New Picks: http://t.co/6sqzAAvjDY $AMZN $QCOM $CSCO
IH News Desk
3 Oct 15 21:43:18
$NSC Short Sales Updated Saturday, October 3, 2015 12:11:26 PM $SPG $COST $KMI $AMZN http://t.co/xHpexFOlpl
3 Oct 15 21:31:29
RT @OMillionaires: #FANG Performance YTD : $FB $AMZN $GOOGL $NFLX $SPX $SPY http://t.co/fPTCYBIoW1
3 Oct 15 21:19:35
$AMZN Stock Price Updated Saturday, October 3, 2015 12:07:28 PM $BIDU $FXE $MU $GDXJ http://t.co/0fqofMKgHB
Disrupt and Innovate
3 Oct 15 21:10:18
Was Friday's Rally A Fake Out? http://t.co/p2L2563MCf $AMZN $CMG $FB $NFLX $TLT $TSLA $DIA $SPY
3 Oct 15 21:05:05
RT @OMillionaires: #FANG Performance YTD : $FB $AMZN $GOOGL $NFLX $SPX $SPY http://t.co/fPTCYBIoW1
L J Furman
3 Oct 15 20:30:13
Commented on: "Dear Tim Cook, Amazon Just Banned Your Apple TV 4" http://t.co/m3vRQgdHQt $AAPL $AMZN $GOOG $GOOGL
Rosner Stocks
3 Oct 15 20:29:37
$BAC Stock Forum Updated Saturday, October 3, 2015 10:59:21 PM $GDX $NUGT $AMZN $GPRO http://t.co/BPySr8Zkcb
CapCube NYC
3 Oct 15 20:27:45
Time for mean reversion @OMillionaires: #FANG Performance YTD : $FB $AMZN $GOOGL $NFLX $SPX $SPY http://t.co/ZudUwibQx8”
Time=Best Stock
3 Oct 15 20:11:27
RT @PipsToDollars: $amzn $aapl $googl Amazon Goes After Apple and Google -- Which Tech Stock Should You Buy? http://t.co/ZT2iB1ZxS7 via @Th…
Leilani Pips™
3 Oct 15 19:58:19
$amzn $aapl $googl Amazon Goes After Apple and Google -- Which Tech Stock Should You Buy? http://t.co/ZT2iB1ZxS7 via @TheStreet
3 Oct 15 19:58:17
RT @OMillionaires: #FANG Performance YTD : $FB $AMZN $GOOGL $NFLX $SPX $SPY http://t.co/fPTCYBIoW1
By  +Follow December 5, 2013 12:53PM



blog comments powered by Disqus

 Today's Must Reads

Market Got You Down?: Here Are Six Hot Stocks

Global Winners and Losers in the Oil Shakeout

This Bull Market is No Stranger to Big Fourth-Quarter Comebacks

When to Sell and When to Rent an Investment Property

Saving the Small-Cap Market


Small-cap stocks offer investors many benefits, ranging from higher growth potential to overlooked value opportuni... in Equities.com's Hangs on LockerDome

About us

Equities.com is an advanced financial data portal and social network designed to connect self-directed investors with the world’s most innovative startup and small cap companies. Through our in-depth coverage of small cap markets, comprehensive research and stock valuation reports, state of the art issuer products, and world class events, Equities.com provides the social tools and insight that drive tomorrow’s investment relationships and opportunities.

Market Data powered by QuoteMedia.
Copyright © QuoteMedia. Data delayed 15 minutes unless otherwise indicated. Terms of Use.

Login or Register