The top five best-performing exchange traded funds all had a bias towards technology last year, according to BetaShares.
In its end of year review, the firm said assets in the industry grew by more than 50% to $95.2 billion in 2020 as investors looked to ETFs to offer liquidity in a volatile market environment.
Looking at performance, two of the top five funds returned more than 60% in 2020, an outstanding performance to the low single digit figures from the ASX 200.
The top five funds were ETFS Battery Tech and Lithium ETF, BetaShares Asia Technology Tigers ETF, BetaShares Global Robotics and Artificial Intelligence ETF, BetaShares Global Cybersecurity ETF and ETFS Morningstar Global Technology ETF.
These returned 62.2%, 61.3%, 37.6%, 36.7% and 34% respectively, according to FE Analytics.
“The top five products for performance were essentially all technology-orientated exposures, with this sector performing particularly well in the pandemic environment,” BetaShares said.
“In the BetaShares stable, Asia was a real standout, not only from a performance perspective but for flows as well with the product receiving over $300m in net new money.”
According to its factsheet, the top-performing ETF was invested in companies such as Pilbara Minerals, Renault and Tesla among its top five holdings while its largest geographic allocation was to Japan at 26.8% followed by the US at 22.4%.
“Recent advances in battery technology have seen the development of the ability to store energy in increasingly smaller and lighter forms. Alternative sources of energy generation and the ability to efficiently store that energy is ushering in a new paradigm in energy consumption,” BetaShares said.
“Growth in usage of mobile phones and other personal electronic devices has driven demand for lithium in recent years. Electric vehicle demand is already high and expected to increase substantially in coming years. Grid storage technologies are also anticipated to grow.”
Since its launch on 30 August 2018, the fund had returned 82% to 31 December, 2020, versus returns by the commodity and energy sector within the Australian Core Strategies universe of 35.2%, according to FE Analytics.
