Nasdaq ETFs

The Thematic ETF universe continues to expand with roughly $7.5 billion of new net inflows this year, despite a notable exposure to growth companies and a kickstarted monetary tightening policies in various corners of the world. Last year, Thematic ETFs netted $100 billion in inflows and have grown to become one of the go-to investment vehicles to gain exposure to themes, trends and megatrends shaping our future. Thematic ETFs are a solution of choice for thematic investing. In a single transaction, investors can capture the investment opportunity of one or more themes that may have long-term capital appreciation prospects.

Disruptive technologies, Digital Infrastructure & Connectivity, Natural Resources, and China Disruptive Technology are among the most popular themes this year, drawing $1.56, $1.24, and $1.21 billion respectively. The first theme made it to the top on investors' dip-buying after technology shares slumped on the prospects of multiple rate hikes.

Natural resources have been among the performing themes this year as inflation, global supply chain disruption and the recent Russia-Ukraine war. The war lifted the prices of various edible (e.g., agriculture) and non-edible commodities (e.g., metals) – and consequently the profitability prospects of their producers.

On the other hand, the China Disruptive Technology theme has been a target for many bargain hunters as the underlying holdings witnessed a long-lasting and gut-wrenching performance triggered by China's crackdown on various industries.

ARK Innovation ETF (ARKK), iShares Exponential Technologies ETF (XT), and SPDR S&P Kensho New Economies Composite ETF (KOMP) are the largest ETFs in the disruptive technology theme. Cathie Wood's ARKK has been the most popular – receiving a staggering $1.49 billion out of the total net inflows added to the theme.

For the natural resources theme investors, SPDR S&P Global Natural Resources ETF (GNR, $478 million), FlexShares Morningstar Global Upstream Natural Resources Index Fund (GUNR, $430 million), and iShares North American Natural Resources ETF (IGE, $300 million) are among the most popular in 2022.  For instance, GNR seeks to track the S&P Global Natural Resources Index and invest in companies involved in natural resources and commodities businesses such as agriculture, energy and metals and mining.

Finally, the China Disruptive technology theme can be accessible through KraneShares CICC China 5G & Semiconductor Index ETF (KFVG), KraneShares SSE STAR Market 50 Index ETF (KSTR), and KraneShares Hang Seng TECH Index ETF (KTEC). While they are part of a popular theme, the trio witnessed a combined net outflow of -$19 million.

According to Taiwan's Ministry of Economic Affairs (MOEA), orders for Taiwanese exports jumped 21.1% from a year earlier to US$51.6 billion in February of 2021, accelerating from an 11.7 % rise in the previous month and beating the expectations of a 12.75% % increase.

Orders remained robust for electronic products (31.6 %) and for information & communication products (29.7 %). Orders from the US jumped 23.5 %, followed by a 22.3% rise in orders from Europe, while those from its main trading partner China were up 17.6%.

Huang Yu-ling, head of the MOEA's Department of Statistics, told reporters that the increase in Taiwan's export orders in February, also represented 24 straight months of growth. This can be attributed to an improvement in the supply of raw materials and robust demand for new emerging technologies such as 5G, high-performance computing and emerging applications.

American investors: How to invest in Taiwan with ETFs

Investors betting on a stellar economic year in Taiwan can gain exposure through exchange-traded funds. iShares MSCI Taiwan ETF (EWT) and Franklin FTSE Taiwan ETF (FLTW) are two available options. EWT is the largest with over $6.5 billion in assets under management. The fund seeks to track the MSCI Taiwan 25/50 Index and invests in large and mid-sized companies in Taiwan. In terms of sector allocation, information technology (58%) has the highest exposure, followed by financials (20%), materials (7.47%), and industrials (5%). As of March 18th, 2022, there are 87 holdings. The top leading names include Taiwan Semiconductor Manufacturing (21%), Mediatek inc. (4.76%), Hon Hai Precision Industry Ltd. (4.22%), United Micro Electronics (2.15%), and Fubon Financial Holdings Ltd. (2.02%). 

EWT has a total expense ratio of 0.57% and trades on the NYSE Arca. This year, the ETF's share price has dropped by -6.1% on rising global macroeconomic and geopolitical turmoil.