In April 2008, State Street’s intermediary business group, which is the investment management arm of State Street Corporation, launched SPDR University—an agile learning portal exclusively for financial advisors.

The intermediary business group is responsible for distributing its SPDR (pronounced “spider”) Exchange Traded Funds (ETFs) and additional products via financial advisors, brokers, and other investment professionals. While State Street is one of the world’s largest ETF providers, competition for advisor mindshare—and assets—is fierce. That’s why State Street made a strategic decision to offer its prospects and customers considerably more than just investment product and performance data. Read more…

ETF BASIC NEWS

Simplicity was a strong selling point of the first exchange traded funds offered in the early 1990s. Issuers bought the shares that made up the underlying index and sold them on to investors in the form of a single easily traded security.

But as the range of assets covered by ETFs has expanded it has become more difficult to assemble the underlying portfolio. Issuers have found a way round this difficulty by means of swaps, exchanging a perhaps less than perfect bunch of assets for a swap that precisely mirrored the relevant index. Read more…

ETF BASIC NEWS

How bad are inverse exchange-traded funds (ETFs) at returning the inverse movements of the indexes they track? Frank Elston and Doug Choi tell us in a paper published in the Proceedings of the Academy of Accounting and Financial Studies (Volume 14, Number 1: 2009). It turns out out they can be so bad in replicating implied returns that Elston and Choi conclude investors would be better off in many instances shorting the long or double-long ETFs instead. Read more…

NYSE:DOG, NYSE:DUG, NYSE:DXD, NYSE:FXP, SRS

Actively managed exchange traded funds are finally starting to trickle into the market.

But for the trickle to become a flood, active ETFs will have to overcome a number of obstacles, not the least of which is the establishment of desirable performance.

“Would people want active management that comes with the tax advantages, transparency and liquidity of an ETF?” asked Scott Burns, the director of ETF analysis at Morningstar Inc. of Chicago and editor of Morningstar ETFInvestor, a monthly newsletter. “The answer is yes, but if it turns into a tradeoff for returns, the answer is no.”

It is a challenge, but some asset managers think that they are up to it.

The Grail American Beacon Large Cap Value ETF (GVT) from Grail Advisors LLC of San Francisco, which began trading on May 4, allows portfolio managers unrestricted trading.

Full Story: http://www.investmentnews.com/apps/pbcs.dll/article?AID=/20090531/REG/305319965/1025/ETF

ETF BASIC NEWS, NYSE:GVT

Well, here we are on the final trading day of May.  Taking account for the month, the real story’s been agriculture in its manifest forms.

For investors at the sector level, the 9.8% gain scored by the PowerShares DB Agriculture Fund (NYSE Arca: DBA) in May could portend a broader resurgence in commodities. A more vigorous equity market breeze blew at the back of the Market Vectors Agribusiness ETF (NYSE Arca: MOO), however, pushing the fund 17.8% higher for the month. Read more…

ETF BASIC NEWS, MOO, NYSE:DBA

Making money in bonds when the dollar is tanking … when deficit spending is surging … when interest rates are rocketing … and when the U.S. government’s AAA credit rating is openly being questioned … sounds darn near impossible. And it is if you spend all your time focused on U.S. bonds.

But this unique combination of forces also opens up specific profit opportunities in one corner of the bond market — FOREIGN debt.

 In fact, one of my favorite foreign bond mutual funds has gained more than 4.5 percent in the past month. Compare that to something like the iShares Barclays 20+ Year Treasury Bond Fund (TLT), which has plunged 22 percent in 2009 alone! Read more…

TLT

Underground investor David Fessler, writing at Investment U, says the four best hedges against inflation are gold, inflation-adjusted Treasuries, energy stocks and commodities such as wheat, metals, cattle and fertilizer.

1) Gold

David recommends investors hold 5% of their portfolio in gold to hedge against a declining dollar and an inflationary economy. He says investors can easily buy gold through the SPDR Gold Trust ETF (NYSE:GLD). This tracks the price performance of gold bullion without the hassles of finding and storing the physical metal. Read more…

NYSE:GLD, TIP

The exchange traded fund (ETF) industry is gaining popularity both in the states and abroad, and a recent industry review has shown just how much ground ETFs have covered.

The characteristics of ETFs are hard to ignore for any savvy investor. ETFs have two forms of liquidity: First, through shares on a secondary basis on an exchange. Second, through a primary basis via an unique creation process, according to iShares. ETFs are also traded at or close to their underlying net asset values (NAV). But it should be noted that divergence in performance of an ETF to its benchmark is possible.

In a recent review of the ETF industry by Barclays Global Investors, the overall picture of the ETF industry shows:  Read more…

ETF BASIC NEWS

As the U.S. dollar depreciates because of  increased government spending, investors may turn to exchange traded funds (ETFs) to defend their wealth. Here’s how.

The U.S. dollar is under attack and there are several factors that are eating away at the dollar’s strength, remarks Ron DeLegge for ETF Guide. The Chinese yuan is being pushed to be included in the IMF’s basket of fund payments for bilateral trades, and the currency may overtake the U.S. dollar as the world’s reserve currency. The U.S. government is also continuing its defacement of the dollar by increasing spending and deficits. Read more…

NYSE:CYB, NYSE:FXA, NYSE:FXC, NYSE:FXM, UDN, UUP

Invesco’s PowerShares unit has been a leader in specialized ETFs. Its Global Progressive Transportation Portfolio(PTRP), which tracks green transportation trends, is one of its more notable funds. Even though specialized ETFs haven’t gained traction with investors, the funds can help manage volatility in a portfolio and take advantage of the stock market’s cycle. The performance of specialized ETFs like the Global Progressive Transportation ETF depends on both industry developments and big-picture trends.

Anyone who considers investing in such a fund should look at it from both a “bottom up” and “top down” perspective. Investors need to research the financial state of the companies the fund holds, the demand for their products and industry trends. They must also weigh macroeconomic factors, such as the direction of the market. Read more…

PTRP

At least one investor is expressing bullishness, betting on iShares Silver Trust ETF (SLV Quote) and boosting normal daily volume more than 20-fold today.

Between 1 p.m. EDT and 2 p.m. EDT, an investor sold 100,000 SLV Jan. 2010 13 puts and simultaneously bought 75,000 SLV Jan. 2010 14 calls. He also sold 100,000 Jan. 2010 19 calls in the name. Normal daily options volume in SLV is around 10,000 option contracts, but approximately 220,000 SLV options have traded with about half an hour left to go in the trading day.   Read more…

SLV

Hat tip to AbnormalReturns.com for highlighting a post by the Bespoke Investment Group about rising oil prices yet oil stocks lagging behind, the question is when will oil stocks catch-up to oil prices? If there’s one take away, its the ProShares Ultra Oil & Gas (ETF) (NYSE:DIG).

First up, the Bespoke Investment Group on Oil Continues to Outperform Oil Stocks:  Oil continues to rally on a daily basis and it is now up to $65/barrel after getting down to the $30s just a few months ago.  At the same time, oil stocks have lagged the commodity pretty significantly.    Read more…

NYSE:DIG

John Paulson had expertise in merger arbitrage, so betting against the housing bubble was met with extreme skepticism when he tried to raise money for his Credit Opportunities fund in 2005. The original amount raised was only $150 million, mainly from European investors. The fund was invested in cheap — at the time — credit-default swaps on mortgage bonds, and later, in outright short positions of the various ABX indexes, which track the performance of different vintages of mortgage securities.

The fund also sold short risky slices of CDOs, which in the end completely evaporated in value. In a CDO structure, profits trickle down from the top, while losses on mortgages are first absorbed by the lower-rated tranches. If there are large losses — as there were in this case — the lower-rated tranches completely disappear as the losses are being absorbed. Read more…

ETF BASIC NEWS, NYSE:GDX, NYSE:GLD

There are bits and pieces along the Vegas strip that still remind people of the recession, however, one big new attraction is still set to open on time despite a slowdown in markets and exchange traded funds (ETFs).

The CityCenter is one of the largest privately financed developments in the United States. The $8.5 billion city within a city is set to open later this year. Allison Gregor for The NewYork Times says this 67-acre development on the Strip consists of six towers with 2,392 apartments, as many as 5,900 hotel rooms, a casino, a shopping center and an entertainment complex. Read more…

NYSE:BJK

The answer lies in the rise in oil prices. Crude prices have risen above $64/barrel, US Oil Fund ETF (NYSE:USO) is up more than 5%, and solar stocks are following along for the ride. The sentiment seems to be that demand for oil will translate into demand for energy from all sources. Even coal miner Read more…

ETF BASIC NEWS, USO