XSD SPDR S&P Semiconductor

Monday was a mixed day for U.S. equities as Apple dragged down the Nasdaq while the Dow managed to finish up by 0.6% on the day. Meanwhile, the broad S&P 500 finished the session down by a point as tech weakness was balanced out by strength in integrated oil, health care, and banking.

Currency trading was also mixed on the day as the dollar index slid marginally to finish the day around the $79.55 mark. This didn’t really translate into the bond market though as the 10 year finished the day flat, just below the 2% yield mark (read Looking For Income? Try High Yield Muni ETFs).

Commodities were more negative on the day across the board as most energy products experienced a slump with the notably exception of natural gas which clawed its way back above the $2 mark. Soft commodities also slid broadly on the day—led lower by coffee, cotton, and sugar—although the base metals did manage to stay firm despite some precious metal weakness in Monday trading.

In the world of ETFs many of the popular equity products saw flat trading volumes although precious metals saw extremely light trading while those in the tech space saw a boost on Apple’s slide. Beyond broad tech ETFs, investors also saw a spike in interest in many of the specialized technology ETFs as well to open up the week.

In particular the SPDR S&P Semiconductor ETF (XSD) experienced a huge bump in volume, trading nearly 465,000 shares compared to its daily average of 53,000. This was especially surprising given the flat trading that investors saw in many of the other semiconductor ETFs in the session (read Intel Report Crushes Semiconductor ETFs).

Possibly, the outsized trading volume could have been due to XSD’s role as the equal-weighted choice in the space. Thanks to this, the fund is much less concentrated on large caps—they only make up 12% of the total—and can experience higher levels of volatility. With this focus, XSD may have gained some appeal from traders looking to make a broad play on the smaller corners of the sector ahead of a few key earnings reports over the next few weeks.

Another ETF that had outsized trading volumes was the SPDR S&P Emerging Markets ETF (GMM). This fund saw an incredible increase in interest as over half a million shares changed hands today, far above the roughly 20,000 that investors usually see in this ETF.

The movement is especially unusual given the relatively flat volumes in many other ETFs in the space including popular products like EEM and VWO, which saw trading above average but nothing on the scale of GMM (see Three Overlooked Emerging Market ETFs).

Possibly, GMM is finally starting to garner some respect as a diversified play on the space thanks to its nearly 570 holdings and well spread out product structure across nations. Beyond this, it is unclear why this emerging market ETF saw such a huge spike in volume but investors should nonetheless keep their eyes on this fund for future outsized trading activity.

See more on ETFs at the Zacks ETF Center.

 
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