{"id":2107,"date":"2026-01-05T05:34:20","date_gmt":"2026-01-05T05:34:20","guid":{"rendered":"https:\/\/www.innov8fs.co.za\/blog\/?p=2107"},"modified":"2026-03-18T11:46:04","modified_gmt":"2026-03-18T11:46:04","slug":"be-careful-buying-the-top-10-etfs-of-2025-they-have-very-little-if-any-role-in-your-portfolio-says-expert","status":"publish","type":"post","link":"https:\/\/www.innov8fs.co.za\/blog\/2026\/01\/05\/be-careful-buying-the-top-10-etfs-of-2025-they-have-very-little-if-any-role-in-your-portfolio-says-expert\/","title":{"rendered":"Be careful buying the top 10 ETFs of 2025: They have \u2018very little, if any\u2019 role in your portfolio, says expert"},"content":{"rendered":"

\"\"<\/p>\n

If your portfolio is invested in\u00a0exchange-traded funds, you may have had a very good 2025. The S&P 500 \u2014 the index tracked by the three largest ETFs on the market, per ETF Database \u2013\u00a0returned about 16% in 2025.<\/p>\n

But in theory, depending on which funds you held, you could have done quite a bit better.<\/p>\n

The MicroSectors Gold Miners 3X Leveraged ETN, a fund which tracks the price of a privacy-focused cryptocurrency, finished the year up 796% \u2014 the best of any U.S. traded ETF, according to data from FactSet analyzed by CNBC. You could have also earned a huge return had you bought other ETFs focused on metal mining or Korean stocks.<\/p>\n

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Top 10 performing ETFs in 2025<\/h3>\n<\/div>\n
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The horizontal bar chart shows the 10 highest performing ETFs in 2025.<\/div>\n
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\n\n\n\n\n\n\n\n\n\n\n\n\n
Table with 3 columns and 10 rows. (column headers with buttons are sortable)<\/caption>\n
MicroSectors Gold Miners 3X Leveraged ETN<\/th>\nGDXU<\/td>\n\n
+796%<\/div>\n
\n
\n
+796%<\/div>\n
+796%<\/div>\n<\/div>\n<\/div>\n<\/td>\n<\/tr>\n
Direxion Daily MU Bull 2X Shares<\/th>\nMUU<\/td>\n\n
+558%<\/div>\n
\n
\n
+558%<\/div>\n
+558%<\/div>\n<\/div>\n<\/div>\n<\/td>\n<\/tr>\n
GraniteShares 2x Long MU Daily ETF<\/th>\nMULL<\/td>\n\n
+556%<\/div>\n
\n
\n
+556%<\/div>\n
+556%<\/div>\n<\/div>\n<\/div>\n<\/td>\n<\/tr>\n
Direxion Daily Junior Gold Miners Index Bull 2X Shares<\/th>\nJNUG<\/td>\n\n
+466%<\/div>\n
\n
\n
+466%<\/div>\n
+466%<\/div>\n<\/div>\n<\/div>\n<\/td>\n<\/tr>\n
BetaPro Canadian Gold Miners 2x Daily Bull ETF<\/th>\nGDXU<\/td>\n\n
+432%<\/div>\n
\n
\n
+432%<\/div>\n
+432%<\/div>\n<\/div>\n<\/div>\n<\/td>\n<\/tr>\n
Direxion MSCI Daily South Korea Bull 3X Shares<\/th>\nKORU<\/td>\n\n
+426%<\/div>\n
\n
\n
+426%<\/div>\n
+426%<\/div>\n<\/div>\n<\/div>\n<\/td>\n<\/tr>\n
Direxion Daily Gold Miners Index Bull 2x Shares<\/th>\nNUGT<\/td>\n\n
+423%<\/div>\n
\n
\n
+423%<\/div>\n
+423%<\/div>\n<\/div>\n<\/div>\n<\/td>\n<\/tr>\n
ProShares Ultra Silver<\/th>\nAGQ<\/td>\n\n
+361%<\/div>\n
\n
\n
+361%<\/div>\n
+361%<\/div>\n<\/div>\n<\/div>\n<\/td>\n<\/tr>\n
BetaPro Silver 2X Daily Bull ETF<\/th>\nSLVU<\/td>\n\n
+349%<\/div>\n
\n
\n
+349%<\/div>\n
+349%<\/div>\n<\/div>\n<\/div>\n<\/td>\n<\/tr>\n
WisdomTree Efficient Gold Plus Gold Miners Strategy Fund<\/th>\nGDMN<\/td>\n\n
+226%<\/div>\n
\n
\n
+226%<\/div>\n
+226%<\/div>\n<\/div>\n<\/div>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<\/div>\n<\/div>\n<\/div>\n<\/div>\n
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While it can be fun to fantasize about what your returns could have looked like had you chosen one of last year\u2019s big winners, you should think twice before choosing one as a major building block of your investing strategy, says Jeff Ptak, managing director for Morningstar Research Services.<\/p>\n

\u201cThey should play very little, if any, role in your portfolio,\u201d he says. \u201cMost of what you see at the top of these lists is niche, hyper-volatile, gimmicky. These aren\u2019t words I would associate with prudent, long-term investing.\u201d<\/p>\n<\/div>\n

<\/a>Beware of the big winners<\/h2>\n
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Prudent, long-term investing is generally the name of the game if you\u2019re hoping to build wealth, investing experts say. So what makes some of the 2025 winners unsuitable?<\/p>\n

Leveraged funds<\/h3>\n

One common theme on the list is the use of leverage, the practice of buying or selling derivatives to amplify a fund\u2019s return. Rather than seeking to track the return of an index, funds with 2X or 3X in the name aim to deliver multiples of that same return. This makes them highly volatile, and likely candidates for year-end best-of \u2014 or worst-of \u2014 lists, says Roxanna Islam, head of sector and industry research at TMX VettaFi, an investment research firm and index provider.<\/p>\n

\u201cI don\u2019t think it\u2019s surprising to see leverage at the top,\u201d she says. \u201cWith two or three times [returns] they\u2019re most likely going to be in the top at some point.\u201d<\/p>\n

The problem with these funds, for long-term investors, is that they aim to produce 200% to 300% of the index\u2019s return on a daily basis, resetting for each trading day. In other words, they\u2019re for\u00a0day traders, not investors, says Islam.<\/p>\n

\u201cThese are basically used as short-term trading instruments. They\u2019re intended to be held for one day,\u201d she says. \u201cThey\u2019re not something to hold for a whole year, even though you see a high [2025] return.\u201d<\/p>\n

Volatile areas of the market<\/h3>\n

Another common theme among winning 2025 ETFs: precious metals mining funds.<\/p>\n

It\u2019s no surprise that some companies that mine for the shiny stuff did well last year.\u00a0Gold prices\u00a0spiked by about 65% in 2025 and\u00a0silver\u00a0rose by more than 140%. These firms, some of which have more well-established mining operations than others, benefit from rising precious metals prices.<\/p>\n

While owning precious metals \u2014 often as a\u00a0portfolio diversifier or an inflation hedge\u00a0\u2014 is a common investment strategy, says Ptak, investing in miners is \u201ca whole other kettle of fish.\u201d<\/p>\n

That\u2019s because, in addition to fluctuations in metal prices, these firms\u2019 stock prices move based on changes to the underlying business, which can be volatile and highly indebted, says Ptak.<\/p>\n

\u2033[Mining ETFs] are only slightly less speculative than something that\u2019s got 2X or 3X in the name,\u201d he says.<\/p>\n<\/div>\n

<\/a>Make smarter moves<\/h2>\n
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Overall, when considering adding any high-performing fund to your portfolio, you\u2019d be wise to consider its long-term track record as well as how its objectives fit within your investment strategy, says Islam. It may be wise to do this with the help of a financial professional.<\/p>\n

And when browsing year-end lists, remember that you\u2019re looking for consistent, long-term returns rather than short-term wins, says Islam.<\/p>\n

\u201cPast performance does not equal future performance, especially when you\u2019re looking at a lot of these smaller themes, smaller ETFs,\u201d she says. \u201cA lot of them don\u2019t tend to show significant outperformance year after year, the same way holding a broad stock market ETF would.\u201d<\/p>\n

Want to give your kids the ultimate advantage?<\/strong>\u00a0Sign up for CNBC\u2019s new online course,\u00a0<\/em>How to Raise Financially Smart Kids<\/em>. Learn how to build healthy financial habits today to set your children up for greater success in the future.<\/em><\/p>\n<\/div>\n

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