Key points
- The ASX 200 may have had a good year in 2021, but not all ETFs did
- 2 ASX growth-focused ETFs have been beaten down
- Market distaste for tech and Chinese companies could be worth a deeper dive
As most investors would be aware of, 2022 has certainly brought a boatload of volatility and unpredictability to the markets. Fresh off a robust 13% performance from the S&P/ASX 200 Index (ASX: XJO) in 2021, 2022 has been a tale of a different nature thus far. But even though the past few months have generally been good to investors, the prosperity hasn't extended to all corners of the market.
So here are 2 ASX exchange-traded funds (ETFs) that have taken a beating recently. Both ETFs could be described as 'growth-focused', and have given investors some very strong returns until recently. Let's dive in.
BetaShares Nasdaq 100 ETF (ASX: NDQ)
Our first ETF is more of an index fund. NDQ mirrors the NASDAQ-100 (INDEXNASDAQ: NDX), an index that follows the 100 largest shares on the US Nasdaq market. The Nasdaq is known for being the exchange that largely houses the US's tech sector. Most of the prominent US tech companies that we all know are housed here, including Apple Inc (NASDAQ: AAPL), Amazon.com Inc (NASDAQ: AMZN), Netflix Inc (NASDAQ: NFLX) and Tesla Inc (NASDAQ: TSLA). Thus, these companies are the ones that dominate the BetaShares Nasdaq 100 ETF's top holdings.
But NDQ has taken a bit of a beating over the past few months. It's already down more than 7% in 2022 so far, as well as losing almost 7.5% since reaching its last all-time high back in early December. Despite this, NDQ has still averaged a 36% return or so on average over the past 3 years (as of 31 December).
BetaShares Asia Technology Tigers ETF (ASX: ASIA)
Another tech-focused ETF, this Asia Technology Tigers ETF from BetaShares has also found itself on struggle street recently. Unlike NDQ however, ASIA has been battling what is now quite an extended slump. This ETF last peaked back in February last year. Since its all-time high of $14.26 a unit, the fund is now asking just $9.30 on today's closing pricing. That's worth a drop of 35% or so.
The BetaShares Asia Technology Tigers ETF invests in a basket of tech-focused shares from… Asia. A large proportion of these shares hail from China's markets, which have been in something of a malaise since early 2021. We can see this in ASIA's top holdings. Two of its top five shares are Tencent Holdings Ltd and Alibaba Group Holding Group Ltd. Tencent's Hong Kong stock is now around 40% off of its all-time high, whereas Alibaba has lost more than 50%.
That probably largely explains the woes ASIA has suffered through over 2021 and more recently. Even though ASIA has given back some of its highs, this ETF has still given investors a 23.65% average annual return over the past 3 years (also as of 31 December).
