ETFdb Logo
ETFdb Logo
  • ETF Database
  • Channels
    • Active ETF
    • Alternatives
    • Beyond Basic Beta
    • China Insights
    • Climate Insights
    • Commodities
    • Core Strategies
    • Crypto
    • Disruptive Technology
    • Dividend
    • Dual Impact
    • Emerging Markets
    • Energy Infrastructure
    • ESG
    • ETF Building Blocks
    • ETF Education
    • ETF Strategist
    • Fixed Income
    • Free Cash Flow
    • Future ETFs
    • Global Diversification
    • Gold & Silver Investing
    • Innovative ETFs
    • Institutional Income Strategies
    • Leveraged & Inverse
    • Managed Futures
    • Market Insights
    • Megatrends
    • Modern Alpha
    • Multi-Asset
    • Night Effect
    • Portfolio Strategies
    • Retirement Income
    • Richard Bernstein Advisors
    • Tax Efficient Income
    • Thematic Investing
    • Volatility Resource
  • Tools
    • ETF Screener
    • ETF Country Exposure Tool
    • ETF Sector Tracker Tool
    • ETF Database Categories
    • Head-To-Head ETF Comparison Tool
    • ETF Stock Exposure Tool
    • ETF Issuer Fund Flows
    • Indexes
    • Mutual Fund To ETF Converter
    • ETF Data for Journalists
    • ETF Nerds
  • Research
    • First Bitcoin ETF
    • ETF Education
    • Equity Investing
    • Dividend ETFs
    • Leveraged ETFs
    • Inverse ETFs
    • Index Education
    • Index Insights
    • Top ETF Sectors
    • Top ETF Issuers
    • Top ETF Industries
  • Webcasts
  • Themes
    • AI ETFs
    • Blockchain ETFs
    • See all Thematic Investing ETF themes
    • ESG Investing
    • Marijuana ETFs
  • Multimedia
    • ETF 360 Video Series
    • ETF Trends on Videos
    • ETF Trends on Podcasts
    • ETF Prime Podcast
  • Company
    • About Us
    • Swag Store
  • PRO
    • Pro Content
    • Pro Tools
    • Advanced
    • FAQ
    • Pricing
    • Free Sign Up
    • Login
  1. Dual Impact Channel
  2. This ETF Could Be Boosted By Contrarian Calls in 2023
Dual Impact Channel
Share

This ETF Could Be Boosted By Contrarian Calls in 2023

Tom LydonDec 20, 2022
2022-12-20

This year’s weakness in growth stocks is an obvious burden for environmental, social, and governance (ESG) exchange traded funds, including the IQ Candriam ESG US Large Cap Equity ETF (IQSU B)+, but some market observers believe growth can rebound in 2023.

The $366.8 million IQSU is predictably growth-heavy, allocating 50.4% of its weight to technology and consumer discretionary stocks. Those two sectors have been pummeled this year amid rising interest rates, making them contrarian bets for 2023, but some analysts aren’t shying from endorsing the rebound potential of growth equities in the new year.

“We have learnt to be suspicious of attention-grabbing contrarian strategies,” Citi quant strategist Robert Buckland wrote in a note. “They might make for good stockbroking, but they do not deliver good long-term investment track records.”

Indeed, wagering on growth at the moment is a contrarian bet and not one free of risk. Value stocks beat their growth rivals for two consecutive years, including 2022. Historically, value’s runs of out-performance have been lengthy, frequently lasting well beyond just two years.

Contrarian equity bulls “are currently long growth, bearish value and prefer cyclical to defensive sectors. They will likely be bullish on U.S. equities, especially tech stocks, and bearish energy,” added Citi’s Buckland.

As is the case with value, energy is in the midst of an impressive two-year run. It will end 2022 as the best-performing sector in the S&P 500 for a second straight year. Assuming Citi’s bearish view on the sector is validated in 2023, IQSU investors won’t be vulnerable because the ESG ETF devotes just 3.2% of its weight to that sector. Only materials and utilities stocks command smaller allocations in the fund.

As for individual stocks that could fit the bill as contrarian wagers in 2023, that group includes a plethora of once beloved large- and mega-cap growth names, including some IQSU member firms. Plenty of those names are currently sporting massive year-to-date drawdowns, including Amazon (NASDAQ: AMZN), which is an IQSU top 10 holding.

Citi also sees semiconductor giants Advanced Micro Devices (NASDAQ: AMD) and Intel (NASDAQ: INTC) as contrarian ideas for 2023. Both reside on IQSU’s roster. Elon Musk’s Tesla (NASDAQ: TSLA), which is IQSU’s eighth-largest holding, is another contrarian idea mentioned by Citi. Battered fintech giant PayPal (NASDAQ: PYPL) receives similar billing from the bank. That stock is also featured in the IQSU portfolio.

For more news, information, and analysis, visit the Dual Impact Channel.

Loading Articles...
Help & Info
  • Contact Us
Tools
  • ETF Screener
  • ETF Analyzer
  • Mutual Fund to ETF Converter
  • Head-To-Head ETF Comparison
  • ETF Country Exposure Tool
  • ETF Stock Exposure Tool
  • ETF Performance Visualizer
  • ETF Database Model Portfolios
  • ETF Database Realtime Ratings
  • ETF Database Pro
More Tools
  • ETF Launch Center
  • Financial Advisor & RIA Center
  • ETF Database RSS Feed
Explore ETFs
  • ETF News
  • ETF Picks of the Month
  • ETF Category Reports
  • Premium Articles
  • Alphabetical Listing of ETFs
  • Best ETFs
  • Browse ETFs by ETF Database Category
  • Browse ETFs by Index
  • Browse ETFs by Issuer
  • Compare ETFs
Legal
  • Terms of Use and Privacy Policy
  • © 2023 VettaFi LLC. All rights reserved.
Follow ETF Database
Follow ETF Database

Advertisement

Is Your Portfolio Positioned With Enough Global Exposure?

ETF Education Channel

How to Allocate Commodities in Portfolios

Tom LydonApr 26, 2022
2022-04-26

A long-running debate in asset allocation circles is how much of a portfolio an investor should...

Core Strategies Channel

Why ETFs Experience Limit Up/Down Protections

Karrie GordonMay 13, 2022
2022-05-13

In a digital age where information moves in milliseconds and millions of participants can transact...

}
X