Categories: Stocks / ETFs

Look to State Street, Invesco for Top-Performing ETFs in 2026

The top-performing non-leveraged ETFs of 2026 span a distinct blend of digital assets, next-generation semiconductor technology, and localized international equity plays. For advisors assessing portfolio allocations heading into the second half of the year, these performance figures highlight a sustained risk-on appetite among investors.

Key Takeaways

Digital assets and hardware infrastructure dominate the top-performing ETFs of 2026, driven by a resurgence in blockchain strategies and semiconductor manufacturing demand.
The State Street Galaxy Digital Asset Ecosystem ETF (DECO) leads all non-leveraged funds with a year-to-date return of 79.6% as of June 2.
International single-country exposures, specifically targeting Taiwan’s tech-heavy ecosystem, emerged as prominent performance drivers alongside traditional energy commodities.

Digital Asset Infrastructure Takes the Lead

The top spot on the leaderboard belongs to the State Street Galaxy Digital Asset Ecosystem ETF (DECO), which posted an impressive 79.6% return for the year-to-date period through June 2. This active ETF benefits from its flexible mandate to hold equity in digital assets, with significant exposure to blockchain infrastructure providers such as Riot Platforms (RIOT) and specialized digital mining entities. The fund’s performance underscores a broader return of capital to digital asset ecosystems, consistent with institutional adoption patterns observed over the past year.

Semiconductor Hardware and Momentum Strategies Surge

Close behind, specialized technology and semiconductor themes dominated the next several tranches of performance data. The Invesco Dorsey Wright Technology Momentum ETF (PTF) posted a 77.1% gain, propelled by its underlying relative-strength tracking methodology, which systematically overweights high-momentum tech leaders.

Hardware providers showed similarly strong returns, with the VanEck Fabless Semiconductor ETF (SMHX) returning 76.8% and the broader VanEck Semiconductor ETF (SMH) gaining 75.6%, underscoring ongoing global capital expenditures on advanced artificial intelligence (AI) applications.

Analyzing the Structural Differences in Chip Design ETFs

SMH and SMHX offer similar exposure, as the two portfolios have a 44% overlap by weight. However, SMHX focuses exclusively on asset-light, fabless enterprises that prioritize innovation in chip design while delegating the manufacturing process to third parties.

Commodities and Generative AI Software Maintain Footprint

The commodity sector also carved out a foothold on the equity-dominated leaderboard. The United States Gasoline Fund LP (UGA) posted a 75.8% gain through June 2, reflecting tight domestic refinery margins and seasonal inventory drawdowns.

Meanwhile, thematic software and retail AI strategies maintained their operational momentum, with the Roundhill Generative AI & Technology ETF (CHAT) and the Invesco AI and Next Gen Software ETF (IGPT) posting year-to-date returns of 75.5% and 71.8%, respectively.

Taiwan Single-Country Allocations Focus on Supply Chains

The concentration of global semiconductor supply chains geographically brought single-country international ETFs sharply into focus. The Franklin FTSE Taiwan ETF (FLTW) yielded 73.4%, slightly edging past the iShares MSCI Taiwan ETF (EWT), which registered a 68.6% return over the same five-month stretch.

Top Performers Add Value in Small Allocations

While high-beta thematic ETFs are generating standout returns, actual asset allocation trends tell a different story. This divergence demonstrates that while thematic software, crypto, and semiconductor vehicles capture headline attention, advisors are primarily using them as satellite positions.

Data from VettaFi shows that investors are keeping their core capital firmly anchored in low-cost vanilla hedges. Vanguard S&P 500 ETF (VOO) commands the top slot with over $65 billion in YTD flows, while State Street SPDR Portfolio S&P 500 ETF (SPYM) trails in second with nearly $37 billion.

Furthermore, other leaders by flows include ProShares GENIUS Money Market ETF (IQMM), pulling in $22 billion, and iShares 0-3 Month Treasury Bond ETF (SGOV), capturing $21 billion in flows.

Originally published on Advisor Perspectives

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