When investors think about huge market winners, Nvidia is one of the first stocks that comes to mind.
But I'm not sure many investors would have picked an oil shipping ETF to be sitting near the top of the list.
The Breakwave Tanker Shipping ETF (NYSEMKT: BWET) finished Friday at US$726.92 after gaining another 11.83%.
It is now up around 3,670% in 2026.
Yes, you read that correctly.
To put that into perspective, $10,000 invested at the start of the year would now be worth around $377,000, before fees and taxes.
And those gains haven't come from AI, crypto, or the latest hot tech stock.
Instead, it has benefited from the soaring cost of moving oil around the world.
Image source: Getty Images
So, what exactly is BWET?
BWET is a pretty unusual ETF.
It doesn't own oil tankers, and it doesn't invest in shipping companies either.
Instead, the fund invests in freight futures, which rise and fall with the cost of transporting oil by tanker.
A large part of that exposure is linked to the cost of shipping oil from the Middle East to China on super tankers.
And that is where things have really taken off this year.
The war involving the US and Iran has disrupted traffic through the Strait of Hormuz.
At the same time, problems around the Red Sea have made some shipping routes longer, more difficult, and much more expensive.
Some vessels have been forced to take longer routes, while others have avoided certain areas altogether.
The result has been a huge jump in tanker freight rates.
And because BWET is tied to those freight prices, the ETF has taken off with them.
The fund is up around 46% in just the past week, 113% over 1 month and more than 1,000% over the past 6 months.
There's a catch
As good as those returns look, BWET definitely isn't the type of ETF most investors would want to buy and forget about for the next 20 years.
Freight rates can move very quickly, and that works both ways.
If shipping routes reopen, geopolitical tensions calm, or more vessels become available, those huge freight prices could come down quickly.
We've already seen how quickly BWET can turn.
Earlier this year, the ETF fell more than 40% in just 2 weeks as investors became more hopeful about peace talks.
There's also the cost to consider.
BWET has an expense ratio of 3.5%, which is very high compared with a typical broad-market ETF.
What investors can learn from this
BWET is probably one of the strangest success stories on the market this year.
At the start of 2026, it was a tiny ETF that most investors had probably never heard of.
Now, it is the best-performing non-leveraged US ETF by a huge margin.
Of course, that doesn't mean investors should suddenly start chasing tanker freight futures.
It's a good reminder to keep looking ahead, because the next big opportunity isn't always where everyone else is looking.
