Whereas the S&P 500 has stumbled roughly 6% year-to-date and growth-heavy benchmarks have fared even worse, a handful of ETFs are posting sturdy features with little fanfare. The widespread thread is actual belongings, tangible commodities, and the sort of companies that profit when the world will get extra unsure.
The Iran battle that erupted in late February, culminating in a near-total disruption of site visitors by means of the Strait of Hormuz, has reshaped the funding panorama in ways in which lengthen nicely past crude oil. Vitality provide chains are fractured, commodity costs are surging throughout the board and traders are rediscovering the enchantment of funds anchored in bodily shortage reasonably than a number of growth.
The World X Lithium & Battery Tech ETF (LIT), Schwab US Dividend Fairness ETF (SCHD) and Invesco Optimum Yield Diversified Commodity Technique ETF (PDBC) are three distinctive investments which have significantly outperformed the market this yr and have a number of tailwinds which will drive them increased.
Picture Supply: Zacks Funding Analysis
The LIT ETF Shares are Gaining on Oil Options
At first look, a lithium and battery expertise fund looks as if an unlikely beneficiary of an oil shock. However when filling an SUV prices $160 and powering an EV for a similar distance runs about $75, the family determination to think about an EV turns into a easy budgeting equation.
LIT tracks the Solactive World Lithium Index, investing throughout the complete lithium worth chain, from upstream miners like Albemarle to battery producers like Panasonic, to end-market names like Tesla. Rio Tinto is the fund’s largest holding at over 21% of belongings, giving it significant publicity to diversified mining as nicely.
What makes the present rally notably attention-grabbing is that it is being pushed by a number of converging forces. Lithium demand projections have been revised sharply increased, as Albemarle now forecasts demand may attain 3.6 million metric tonnes by 2030, greater than double 2025 ranges. Washington’s renewed push to safe vital mineral provide chains has added a coverage tailwind. And the Iran battle has accelerated each the patron economics and a provide constraint on quite a few different commodities.
Buyers ought to notice the dangers, as LIT carries a 0.75% expense ratio, a beta of 1.59, and stays a concentrated, comparatively risky automobile. A lot of the YTD surge has been sentiment-driven, however as a structural play on accelerated battery adoption and commodity constraints, it is onerous to disregard.
As of this morning, the LIT ETF is gapping increased and now nearing the higher sure of a two-month consolidation. Buyers eager on this ETF would possibly look ahead to a break of assist or resistance to think about positioning.
Picture Supply: TradingView
Dividend ETF SCHD Affords Defensive Positioning
SCHD does not sometimes get described as an thrilling fund. It tracks the Dow Jones US Dividend 100 Index, screening for firms with not less than 10 consecutive years of dividend funds and filtering by cash-flow-to-debt ratios, return on fairness, and dividend progress charges. The result’s a portfolio of 100 blue-chip dividend payers that leans closely into vitality, client staples, and healthcare. That composition has been superb for 2026.
With vitality shares comprising roughly 21% of the portfolio, led by ConocoPhillips at 4.2% and Chevron at 4.6%, SCHD has captured vital upside from the oil worth surge. In the meantime, its 19% allocation to client defensive names and 16% in healthcare present additional defensive assist. The fund trades at roughly 18.7x earnings, a significant low cost to the S&P 500’s 23-27x vary, reinforcing its enchantment as a rotation vacation spot throughout the present flight from progress.
The fund simply accomplished its annual March reconstitution, trimming vitality publicity by roughly 8 share factors and including names like UnitedHealth Group, Abbott Laboratories, and Procter & Gamble. The methodology is mechanical, promoting the winners whose rising costs have compressed their yields and shopping for beaten-down high quality names with increased yields and stronger dividend progress trajectories. The incoming shares averaged 63% five-year dividend progress charges versus 37% for the names eliminated.
At a 0.06% expense ratio, a 3.47% yield and a Zacks Rank #2 (Purchase) score, SCHD stands out as an interesting funding alternative. Its 9.4% annualized return over the past 20 years and 11% YTD features point out additional why traders have rotated into the title.
The SCHD ETF is just a few p.c off its highs however exhibiting appreciable relative power versus the broad market indexes. It seems to have damaged out from a descending channel this week, a probably bullish sign.
Picture Supply: TradingView
The PDBC ETF Shares are Up Extra Than 30% YTD
PDBC is the purest expression of the present commodity growth in ETF kind. The fund is actively managed, investing in futures contracts throughout 14 closely traded commodities spanning vitality, valuable metals, industrial metals, and agriculture. Its “optimum yield” technique makes an attempt to mitigate the roll-yield drag that has traditionally plagued passive commodity funds, which is usually a significant edge during times of sustained backwardation.
The Iran battle has been the first catalyst, however PDBC’s rally was nicely underway earlier than the primary missiles flew. Commodities had already been benefiting from a confluence of supply-side constraints and persistently sturdy world progress. The Hormuz closure merely poured gasoline on the development.
With Brent and WTI crude having surged previous $100 per barrel from pre-conflict ranges within the low-to-mid $60s, the vitality part of the portfolio has accomplished the heaviest lifting. However the rally has been broad-based, as gold, industrial metals, and agricultural commodities have all participated.
PDBC’s construction deserves a point out too. In contrast to many commodity ETFs, it points a typical 1099 reasonably than a Okay-1, eliminating a typical tax headache for traders. At a 0.59% expense ratio and $5.5 billion in belongings, it provides institutional-grade liquidity. The fund has attracted over $400 million in internet inflows over the previous three months alone, suggesting that institutional allocators, not simply retail merchants, are constructing strategic commodity positions.
The PDBC ETF has pushed to a different new document excessive this morning, demonstrating continued momentum within the commodity bull market.
Picture Supply: TradingView
How Ought to Buyers Place Their Portfolios
What connects these three funds is a reorientation of market management away from the intangible and towards the tangible. The belongings which have struggled most in 2026, high-multiple progress shares, AI infrastructure performs, long-duration tech, are precisely the sort of companies that endure when vitality prices spike, low cost charges rise, and traders start pricing in a world of persistent provide disruption reasonably than limitless digital abundance.
Whether or not the present atmosphere proves transient or structural relies on the trajectory of the Iran battle and the broader geopolitical recalibration it has triggered. However for now, the market is telling a transparent story: actual belongings are again in vogue, and these three ETFs are using the wave.
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World X Lithium & Battery Tech ETF (LIT): ETF Analysis Experiences
Schwab U.S. Dividend Fairness ETF (SCHD): ETF Analysis Experiences
Invesco Optimum Yield Diversified Commodity Stratgy No Okay-1 ETF (PDBC): ETF Analysis Experiences
This text initially revealed on Zacks Funding Analysis (zacks.com).
The views and opinions expressed herein are the views and opinions of the writer and don’t essentially replicate these of Nasdaq, Inc.
