Written by The White Law Group• January 3, 2024• 6:45 pm• Securities Fraud Articles

Biggest ETF Losers in 2023

Energy and Utility ETFs Decline in 2023

While financial analysts discuss the top-performing ETFs of 2023, it’s prudent for investors to take note of the underachievers — the biggest ETF losers.

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Understanding the worst-performing, the biggest ETF losers, can serve various purposes: from tracking trends and adjusting portfolios to harvesting tax losses or seeking undervalued prospects for 2024. These struggling ETFs convey valuable lessons.

List of Top ETF Losers in 2023

(BOIL) ProShares Ultra Bloomberg Natural Gas -92% (CYA) Simplify Tail Risk Strategy ETF -98.19% (UNG) United States Natural Gas Fund LP -64.04% (XLE) Energy Select Sector SPDR Fund -0.64% (XLU) Utilities Select Sector SPDR Fund -7.17%

In the past year, utility and energy ETFs marked the unfortunate distinction of the lowest performance. Within the broader energy sector, specifically the oil and gas industry, the worst-performing ETFs emerged. In 2023, the Utilities Select Sector SPDR Fund (XLU) representing the utilities sector dipped nearly 6%, while the Energy Select Sector SPDR Fund (XLE) in the energy sector declined by 2.5%, according to an article in eft.com.

Despite utilities ETFs experiencing their most challenging year since 2008, there’s reportedly a recent uptick. For instance, XLU rebounded more than 17% since October’s low, suggesting investors might be shifting from fixed-income Treasury ETFs toward conventional dividend-yielding stocks.

Looking closely at the energy sector’s industry level unveils natural gas ETFs as the poorest performers. The United States Natural Gas Fund LP (UNG) plummeted by over 60%, a stark contrast to the energy sector’s 2.5% dip.

Beyond traditional ETFs, inverse funds faced severe setbacks. Examples include the Simplify Tail Risk Strategy ETF (CYA) and ProShares Ultra Bloomberg Natural Gas (BOIL), which fell by 97% and 93% respectively throughout the year.

Are ETFs Suitable for you?

Exchange Traded Funds (ETFs) can be extremely complex and risky. They are only suitable for wealthy, sophisticated retail investors or institutional investors.

Brokerage firms that sell such products are required to perform adequate due diligence on the investments to ensure a reasonable likelihood of success, and to evaluate whether the investments are suitable considering the client’s age, net worth, investment experience, and investment objectives.

Firms that fail to perform adequate due diligence, or that make unsuitable recommendations, can be held responsible for losses in a FINRA arbitration claim.

Securities Fraud Attorneys

This information is all publicly available and provided to you by The White Law Group.

The White Law Group, LLC is a national securities fraud, securities arbitration, investor protection, and securities regulation/compliance law firm dedicated to helping investors in claims in all 50 states against their financial professional or brokerage firm. Since the firm launched in 2010, it has handled over 700 FINRA arbitration cases.

Our firm represents investors in all types of securities related claims, including claims involving stock fraud, broker misrepresentation, churning, unsuitable investments, selling away, and unauthorized trading, among many others. With over 30 years of securities law experience, The White Law Group has the expertise to help investors defrauded in securities and investment fraud attempt to recover their investment losses. For more information, please visit our website, www.whitesecuritieslaw.com.