It's not often that a single stock can drive an entire exchange-traded fund (ETF). That's the idea behind an ETF; a diverised approach to investing that holds small amounts of many companies in one investment instead of just one company to minimize risk and maximize returns. However, when one stock does move an ETF, it makes a big show.
GameStop
GameStop shares rose from $18.84 at the start of the year to highs of $483 last week. The stock is still trading up over 1,000% for its year-to-date.
That insane rally in such a short amount of time had an impact on the ETFs holding the stock.
Wedbush ETFMG Video Game Tech ETF
Another ETF that was impacted by GameStop's epic run was SPDR S&P Retail ETF
GameStop's takeover of GAMR had led to the fund rising over 12% for the week and almost 27% for the year-to-date. Likewise, the stock's overweight position in XRT pushed the fund up nearly 9% for the week and about 29% for its year-to-date.
XRT's run-up has lead to a massive outflow for the fund, with investors pulling nearly $700 million from the ETF last week, leaving the fund with just $164 million in total assets, according to Bloomberg.
For GameStop's position to change in these ETFs, the stock's rally will have to meet its end, with its share decline bringing the stock's weighting back down naturally. Otherwise, both of the funds are scheduled to be rebalanced in March.