A family’s home isn’t just a place to grill out over long weekends. In most cases, a house is also a family's largest financial asset (and also liability.) For this reason, homebuilders are typically a sort of barometer for the economy. Houses are expensive to build and maintain and typically represent a large commitment to a single place/community. In other words, when homebuilders are doing well, it is widely assumed that people are more confident in their financial picture and willing to improve their living situation. The opposite is also true.

Homebuilders have largely struggled in 2025 despite major markets moving to new all-time highs. Two major representatives (ITB & XHB) are still in the red for the year and are essentially flat over the last 52-weeks, signaling weakness in what has been an otherwise productive overall market environment.  Despite this relatively poor performance, XHB does have quite an interesting technical picture, having just recently moved above NDW’s 3.0 fund score threshold and some significant resistance on its default chart. ITB scores lower by NDW standards due to its large weighting towards a handful of technically weak stocks (top 5 holdings represent roughly 46% of ITB allocation vs. 21% for XHB). The near 2 full points of fund score between the two ETFs also highlights the magnitude of differences between cap weighted and equal weighted options within the subsector. Regardless, there are certainly areas that the analyst team would suggest look better than homebuilders in general, the break past resistance in the low $100’s for XHB is certainly interesting as we open the back half of the year.

Larger names within the sector have struggled so far this year, building on the idea that more focused exposure away from names like DHI or LEN makes sense if you are looking for focused exposure. Many of the few productive names within the space are trading on significant stems. Stocks like JCI & TT come to mind here, both scoring well but trade significantly above traditional PnF support on their default charts. While still in technically overbought territory as of 7/7, Somnigroup International Inc (SGI) could be considered around current levels or on pullbacks towards older resistance in the upper $60’s. Regardless, continue to exercise caution within the space as some of the high level technicals are fragile when it comes to the sector as a whole.  

This week marks our quarterly review of the best and worst-performing ETFs for the second quarter of 2025. Using the Security Screener on our platform, we refined our search within seven different classifications, applying liquidity screens for average volume and net assets, while continuing to exclude leverage or inverse ETFs. This provides a summary of which areas saw the most improvement over the past three months, and which areas saw the most weakness.

We have split the conversation today into two segments. The classifications for all ETFs, broad domestic ETFs, and US sector ETFs are shown in the first segment. The second image shows the other asset classifications, including international equities, commodities, fixed income, and currencies. Each set of images has quarterly performance on the top and annual performance on the bottom. We have also provided some brief commentary on important observations to accompany each section.

All ETFs, Domestic Equity, & US Sectors

Key Observations:

• Uranium (URA) was the best performing asset area over the past three months, gaining 69%. The top ten best performing areas were diverse, including commodities, blockchain areas, and some single-stock funds. Cathie Wood made a comeback in Q2, with three of the ARK ETFs making their way into the top ten overall.
• Oil-related funds were among the worst performers in the “all” classification, and in the sector classification. We also saw high yield equities represented in the worst overall and in the worst domestic equity-only funds.
• Large-cap growth and momentum dominated the top performing broad US funds, and growth-oriented sectors dominated the top performing sector funds.
• Similar themes persisted in the annual performance comparison, although more commodity names were represented in the overall table. Value, small-caps, and some specific sectors were among the worst performers.

International Equities, Commodities, Fixed Income, & Currencies

Key Observations:

• International equities saw consistency between the best funds in Q2 and the best funds so far this year. Europe dominated the list, with European Aerospace & Defense (EUAD) demonstrating sharp improvement. China makes up a large part of the worst performers over the past three months and for 2025. Other weak areas include Turkey (TUR) and Saudi Arabia (KSA).
• Metals dominated the best performing commodity funds, with broad representation from Platinum (PPLT), Gold (BAR), and even the broad fund GLTR. On the other end, energy was the worst performing across both time frames.
• The fixed income space saw notable improvement from foreign bonds given the strength from international equities. Preferreds and convertibles also continued to perform well. TIPs, long-duration bonds, and municipals were among the worst performers.
• The currency space saw consistent strength from Bitcoin funds, while Ethereum bounced back in the second quarter. The US dollar continues to fall, demonstrating further weakness in Q2.

Daily Option Ideas for July 7, 2025