ETF.COM: How To Pick A Sector ETF

Sector investing is popular, and we’ve been hearing a lot about sector rotation opportunities in the face of changing correlations since President Trump’s victory last year. But as an investor, how do you know when it’s time to get in or out of a sector? How do you pick the best sector to be in?

Michael Venuto, co-founder and chief investment officer, Toroso Investments, New York

In our Sector Opportunity Portfolio, we look at job creation per sector and industry on a three-, six- and 12-month basis. Last September, in the report from the Department of Labor, we saw an increase in financial jobs, specifically in the banking industry. In October, we established a position in the SPDR S&P Bank ETF (KBE), which, pre-election, was quite scary.