The Best and Worst Performing ETFs of 2022
6 min read
By Educational Department, ETF Insider

The Best and Worst Performing ETFs of 2022

**To say 2022 was challenging for the global stock market is an understatement. In just one year, the global economy faced some of the most devastating events in recent history: a global monetary tightening, widespread recession fears, international trade hindrances, and of course, the consequential Ukraine-Russia War. As a result, global equities performed their worst year since the financial crisis in 2008 - a testament to the year's dire economic situation.
In light of this, let's underline three ETFs that performed the worst in 2022 while simultaneously highlighting the three ETF outliers that glowed during this turmoil.

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The Top 3 Losers:

1) Sector: Shipping

The dry bulk shipping market experienced a significant downturn due to lockdowns in China and concerns about the country's property market. As a result, the Breakwave Dry Bulk Shipping ETF (BDRY) has seen a decline of 68.95%. This ETF is the only one focused exclusively on the dry bulk shipping market, and it achieves this focus through a portfolio of short-term freight futures contracts on dry bulk indices.

2) Sector: Technology

The recent increase in interest rates has negatively impacted the technology sector. This is because the sector often relies on access to affordable borrowing in order to achieve strong growth, and the value of technology companies is often closely tied to their expected future earnings. As a result, the Viridi Bitcoin Miners ETF (RIGZ) has experienced a drop of 87.21% this year. This actively managed ETF focuses on the securities of companies involved in Bitcoin mining, and it holds a basket of 21 stocks.

3) Sector: Cannabis

Cannabis, a high-growth sector, has suffered as a result of a general market sell-off. The AdvisorShares Pure US Cannabis ETF (MSOS) has experienced a significant decline of 73.04% in value this year due in part to the sell-off in high-growth sectors such as cannabis. This actively managed ETF is the first of its kind to offer dedicated cannabis exposure and to focus exclusively on U.S. companies, including multi-state operators.

The Top 3 Winners:

1) Sector: Hedge Against Interest Rate

Concerns about rising interest rates have had a positive impact on the Simplify Interest Rate Hedge ETF (PFIX), as it registered an astounding YTD return of 86.97%. This is particularly relevant given the Federal Reserve's recent monetary policy, which has included several interest rate hikes, bringing the benchmark rate to its highest since 2008.

2) Sector: Energy

The energy sector has seen a strong performance this year due to rising oil prices, which have been driven by tighter supply and improving demand fundamentals. The overall demand for fuel has returned to pre-pandemic levels. The VanEck Vectors Oil Services ETF (OIH) has risen by 63.61% YTD. This ETF tracks the MVIS U.S. Listed Oil Services 25 Index, which provides exposure to companies that provide oil services to the upstream oil sector, including oil equipment, oil services, and oil drilling.

3) Sector: Turkey

Lastly, Turkish stocks have had a strong performance this year, despite the challenges facing the country, including high inflation and a declining currency. This success can be attributed to differences in monetary policy, as the central bank has lowered interest rates to support consumer spending while other countries have pursued rate hikes. As a result, the iShares MSCI Turkey ETF (TUR) has registered a YTD gain of 91.61%.
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