In this week’s ETF & Markets video we look at: 

• A lay of the ETF land via Z-Scores
• A recently requested chart on Tech sector flows
• The growth of income via option ETFs
• Checking in on year 4 of the bull market

Definitions:

S&P 500 – A widely used stock market index that tracks 500 large-cap U.S. companies across multiple sectors.

S&P500 Industry - The S&P 500 Global Industry Classification Standard (GICS) categorizes companies into 11 sectors, 25 industry groups, 74 industries, and 163 sub-industries based on principal business activity.
Z-Score - measures exactly how many standard deviations a specific data point is above or below the mean in a normally distributed dataset. It represents a standardized, numerical value used to determine how unusual a data point is, with a score of 0 indicating the mean. 

Bull Market - A bull market is a financial market condition where prices for securities (stocks, bonds, commodities) are rising or expected to rise, typically marked by a 20% or more increase in major indices from recent lows.

Equity ETF – An ETF that invests primarily in stocks, providing exposure to a broad market or specific sectors.

Tech Sector - A  (tech) sector ETF is an exchange-traded fund that tracks an index of companies involved in technology-related fields, such as software, hardware, semiconductors, and IT services. These funds provide diversified exposure to the sector, trading on exchanges like individual stocks to allow investors to capture growth in digital transformation.

Silver – is a soft, lustrous, grayish-white precious metal (element Ag) known for its high electrical/thermal conductivity and reflectivity, used in jewelry, coins, and electronics, and also refers to its color, a silver medal (second place), or tableware.

Roundhill Magnificent 7 ETF - The Roundhill Magnificent Seven ETF offers equal weight exposure to the “Magnificent Seven” stocks – Alphabet, Amazon, Apple, Meta, Microsoft, Nvidia, and Tesla. MAGS is the first-ever ETF to track the Magnificent Seven.

Low Vol ETFs - Low volatility ETFs are designed to invest in stocks with lower price fluctuations relative to the broader market, aiming to provide smoother returns with less risk. Primarily, these funds target defensive sectors like utilities and consumer staples, offering a way to stay invested during market turbulence with reduced downside, though they may underperform during sharp bull market rallies. 

Resources ETFs - A resources ETF is a specialized investment fund that tracks an index of companies involved in producing or extracting natural resources, such as energy (oil/gas), mining (gold, iron ore, copper), and agricultural commodities. These funds trade on stock exchanges like individual stocks, offering diversified, low-cost exposure to the commodity sector. 

Dividend ETFs - A dividend ETF is a investment fund that holds a diversified basket of stocks, specifically targeting companies that pay regular dividends to shareholders. These funds, which may be passively or actively managed, are designed to generate income for investors through dividend payments—usually paid monthly or quarterly—alongside potential capital appreciation. 

Option Income ETFs - Option income ETFs are actively managed funds that generate high, regular cash flow (income) for shareholders by holding a portfolio of assets—such as stocks or bonds—and selling (writing) options, commonly covered calls, against those positions. These funds are designed to provide consistent, often monthly, income and potential for reduced volatility, though they typically cap upside capital appreciation and may underperform in strong bull markets. 

This communication was prepared by Strategas (“we,” “us,” or “our”), a brand that offers investment advisory services through Strategas Asset Management, LLC, an SEC Registered Investment Adviser, and provides research to institutional investors through Strategas Securities, LLC, a broker-dealer and FINRA member firm and an SEC Registered Investment Adviser. Information regarding market or economic trends, or the factors influencing historical or future performance, reflects the opinions of management as of the date of this communication, and are subject to change. This communication is provided for informational purposes only and should not be construed as an offer, recommendation, nor solicitation to buy or sell any specific security, strategy, or investment product. The information contained herein has been obtained from sources we believe to be reliable, but no guarantee of accuracy can be made. This communication does not constitute, nor should it be regarded as, investment research or a research report or securities recommendation and it does not provide information reasonably sufficient upon which to base an investment decision. This is not a complete analysis of every material fact regarding any company, industry, or security. Additional analysis would be required to make an investment decision. This communication is not based on the investment objectives, strategies, goals, financial circumstances, needs or risk tolerance of any particular client and is not presented as suitable to any other particular client. Past performance does not guarantee future results. All investments carry some level of risk, including loss of principal.

Strategas Asset Management, LLC and Strategas Securities, LLC are affiliated with Robert W. Baird & Co. Incorporated ("Baird"), a broker-dealer and FINRA member firm, and an SEC Registered Investment Adviser, although the firms conduct separate and distinct businesses.

The ETFs described herein are referenced solely for illustrative purposes and should not be construed as an investment recommendation. An investment in exchange traded funds involves risk, including the possible loss of principal. For important disclosures and risks relating to each ETF referenced herein, see each respective funds’ prospectus or contact your financial professional.