BIG TECH, CRYPTOCURRENCIES POWER 2020’S TOP U.S. FUNDS

Outsized bets on large US technology companies and emerging cryptocurrencies fueled the year’s top-performing US mutual fund and exchange-traded funds as the coronavirus pandemic upended global markets, while funds that bet on oil and gas companies fell nearly 100%, according to data from fund-tracker Morningstar, David Randall reported for Reuters.

The year was a challenge like few others for the $21.3 trillion mutual fund and $4.4 trillion exchange traded funds (ETF) industry.

US stocks plunged in March before staging a more than 60% comeback, while bond yields hung near record lows for much of the year after unprecedented moves by the Federal Reserve to backstop the financial markets and keep interest rates low.

Overall, those who played risk assets were rewarded. The year’s best fund, Grayscale Ethereum Trust, which holds ethereum, the world’s second-largest cryptocurrency after bitcoin, soared 333.7% for the year through Dec. 9, according to Morningstar.

The fund’s gains came during a retail-investor led rally in cryptocurrencies that pushed total assets invested in crypto funds to a record $15 billion, up from $2.57 billion at the end of 2019, according to digital asset manager CoinShares.

Tech was another clear winner from the pandemic as people moved from offices to work-from-home and conducted business by video call while ordering goods online.

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