Market Overview

An ETF For Cyber Monday And Beyond

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An ETF For Cyber Monday And Beyond

Black Friday sales rose to record heights, temporarily quelling the notion that shoppers don't like to go to physical stores anymore and by Thanksgiving, consumers had already spent $50 billion in November.

That set Cyber Monday, the online equivalent of the old Black Friday, up for success and it appears the online shopping event will deliver.

“Shoppers are expected to spend a record $9.4 billion on purchases made on their phones and computers Monday, up about 19% from last year's Cyber Monday, according to Adobe Analytics,” reports TechCrunch.

Although it closed lower Monday, the ProShares Online Retail ETF (NYSE: ONLN) is poised to benefit from Cyber Monday ebullience and beyond.

See Also: Black Friday 2019 Winners And Losers: Amazon, Macy's, Shopify And More

Why It's Important

Up 15.35% year to date, ONLN follows the ProShares Online Retail Index. The fund's recent lethargy is attributable to a similar scenario in shares of Amazon.com (NASDAQ: AMZN). ONLN is one of the more viable ETF proxies on Amazon, allocating 24% of its weight to the largest domestic e-commerce company as of the end of the third quarter.

ONLN's utility isn't confined to specific days, such as Black Friday or Cyber Monday. Rather, the fund is a play on the shift away from physical retailer stores, something that's at play throughout the year.

“Cyber Monday is one of the biggest online shopping events of the year and, combined with Black Friday, kicks the holiday shopping season into high gear,” ProShares said in a recent note. “Between November 1 and December 31, it’s estimated that $143.7 billion may be spent online in the United States. Furthermore, 59% of shoppers are planning to spend at least a portion of their holiday budget online.”

What's Next

As for what's next, ONLN may or may not be imminently responsive to Cyber Monday data. However, longer-term data are on the ETF's side and there's no refuting that.

“Next year, global online sales are projected to surpass $4 trillion—a 41% rise from 2018,” ProShares said. “More than two billion people are expected to be digital buyers in 2020, a 14.5% increase from 2018. In two years’ time, annual online purchases are projected to reach 18.1% of total global retail sales.”

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