The ETF world is growing right now, and if you're wondering where the smart money is going, you're in the right place.
Let's break down what's actually working in today's market and why some sectors are absolutely crushing it while others are playing catch-up.
The Big Winners: Gold Miners
The standout story of 2025? Precious metals mining ETFs are on fire.
Here's what's actually happening: While gold itself is up a solid 25%, the companies that mine it are doing even better, some funds are up over 50% this year. That's the kind of performance that makes you sit up and pay attention.
Top performers include:
SGDM: Up 79% YTD
RING: Up 77% YTD
GDX and SIL: 69-72% gains
Why are gold miners crushing it?
Central banks around the world are buying gold like it's going out of style
Geopolitical tensions make precious metals look attractive
It's getting harder and more expensive to find new gold deposits
Many investors see it as protection against inflation
The reality check: These gains are impressive, but gold mining stocks can be volatile. What goes up fast can come down fast too.
Tech Sector: Still The Champion
Tech companies are expected to grow earnings by nearly 15% in Q4 2025, and there's a massive reason why: AI.
The AI investment boom is real:
Microsoft, Google, Amazon, and Meta are planning to spend a combined $320 billion on AI in 2025
Data centers and semiconductors are in crazy high demand
Every company seems to want their own AI strategy
Best ETFs for tech exposure:
XLK (Technology Select Sector SPDR): The broad tech play
VGT (Vanguard Information Technology): Another solid all-around choice
BOTZ and ARTY: For those who want pure AI exposure
But tech stocks aren't cheap. Some AI companies are trading at 50 times their revenue. That's expensive by any measure.
Semiconductor ETFs: Top Players
If AI is the gold rush, semiconductors are the picks and shovels. Chip ETFs are holding up well:
SMH (VanEck Semiconductor ETF): Up 23% this year
SOXQ (Invesco PHLX Semiconductor ETF): Up 12%
SOXX (iShares Semiconductor ETF): Solid performance across the board
What's driving chip stocks:
AI needs massive computing power = more demand for advanced chips
Electric cars need way more semiconductors than regular cars
5G and smart devices keep expanding
The geopolitical angle: The U.S. is trying to bring chip manufacturing back home, which could benefit the US’ semiconductor companies long-term.
VanEck TruSector ETFs
Here's something interesting for ETF investors: VanEck launched these "TruSector" ETFs (TRUD and TRUT).
What makes them different:
Instead of limiting how much they can own of any single stock, they let the biggest companies be as big as they naturally are
This means if Nvidia or Microsoft dominate their sector, these ETFs will reflect that reality
They had record trading volumes during their launch week
The trade-off: You get more precise exposure to what's actually driving a sector, but you also get more concentrated risk. It's not for everyone.
What The Fed is Doing
The Federal Reserve is probably cutting interest rates in September, there's a 93% chance according to market pricing.
What this means for your ETFs:
Lower rates generally help growth stocks (like tech)
Companies can borrow money more cheaply
Dividend-paying stocks become relatively less attractive compared to growth stocks
Gold often does well when rates fall
The inflation wildcard: Prices are still rising faster than the Fed wants (around 3% vs. their 2% target), so they can't cut rates too aggressively.
The Risks Nobody Wants to Talk About
Let's be honest about what could go wrong:
Economic concerns:
JPMorgan thinks there's a 40% chance of recession in the second half of 2025
Geopolitical tensions are creating uncertainty everywhere
Some valuations (especially in AI stocks) are getting pretty stretched
Sector-specific risks:
Tech: What if AI doesn't live up to the hype?
Gold miners: What if the dollar gets stronger or tensions cool down?
Semiconductors: These stocks can be cyclical and volatile
What Should You Actually Do?
If you're building a portfolio right now, here's a practical approach:
Core holdings (60-70% of your ETF allocation):
Broad market ETFs like VTI or SPY for your foundation
Maybe some international exposure with VEA or VWO
Growth plays (20-30%):
XLK or VGT for tech exposure
GDX for some gold miner exposure (but don't go crazy)
SMH for semiconductor exposure
Defensive positions (10-20%):
Some utilities or consumer staples ETFs for when things get rocky
Maybe some dividend-focused funds
Forward Outlook
August 2025 has been all about precious metals miners leading the charge, while tech and semiconductors continue their longer-term AI-driven growth story. The new VanEck TruSector ETFs are getting attention from institutional investors who want pure sector exposure without diversification constraints.
The smart play right now? Don't chase last month's winners too aggressively. The best ETF strategy is usually boring: broad diversification, regular investing, and not trying to time the market perfectly.
Keep an eye on: Fed rate cuts, AI spending trends, geopolitical developments, and whether inflation actually comes down as expected. These are the big drivers that will determine which ETF sectors outperform in the coming months.
Remember: Past performance doesn't guarantee future results, and all investing carries risk. This analysis is for informational purposes only and shouldn't be considered personalized investment advice.