All ETF Daily News Articles

What to Short When the Rally Dies

down-arrow1I have been droning on for what seems an eternity (a few weeks) that I feel this market rally is just overdone and due for a fall. I still feel that way, but am getting to the point where I am going to put some money where my mouth is. Now, don't get me wrong. I have been very happy to be wrong for the last month as the rally has been very good to me. Core large long holdings like Dow Chemical (DOW) (which I significantly added to at $6.80 in March and again at $9 in early April), AutoNation (AN), Sears Holdings (SHLD) and Wells Fargo (WFC) have all seen tremendous share price increases of at least 50% since the March lows (I am still down 10% in Wells Fargo overall though). This makes up for the gut-wrenching carnage in January and February, though Sears and AutoNation are up 50% and 60% YTD respectively................. ...............There are over 6 million folks without jobs now, the housing industry is simply in shambles and getting worse, foreclosures are surging, Q1 GDP is decidedly negative and Q2 looks only marginally - if any - better. Commercial Real Estate is the next time bomb to drop on banks and that fuse is only just beginning to burn, and the Federal Reserve is just about all out of ammo unless they want to start paying people to borrow. In short, not too much to be optimistic about. Do I short CRE with the SRS ETF? Not for me. REITs are already on death's doorstep, so buying in there might be a bit like going hunting and shooting a deer caught on a trap - not very satisfying or meaningful. Short financials with FAZ? Not too sure about that one either. While the rally there has been spectacular and unwarranted, it has become clear that the US Government will stop at nothing, including changing accounting rules, bogus "stress tests" and more capital infusions to make sure the banks are propped up. That said, I am hesitant to bet against the guy with the ability to change the rules of the game on a whim to make sure he wins. Full Story:  http://seekingalpha.com/article/131474-what-to-short-when-the-rally-dies?source=yahoo
NYSE:FAZ April 17, 2009 10:22am

Gold steadies, ETF falls from record

3-16-09-gold-125x125Gold hovered near a one-week low on Friday, pressured by firming equities, while dealers took a drop from a record high in the world's largest gold-backed exchange-traded fund as a sign investor demand may be receding. Holdings of New York's SPDR Gold Trust fell 0.7 percent from the record high it had climbed to on April 9, the biggest decline this year.  The holdings fell to 1,119.43 metric tons by April 16, down 8.25 metric tons from the previous day. The trust's holdings have fallen about 1 percent so far in April, versus a rise of roughly 4 percent in the comparable period last month.  For details, click on: http://www.exchangetradedgold.com/iframes/usa.php Full Story: http://www.reuters.com/article/hotStocksNews/idUSTRE53G0OO20090417
NYSE:GLD April 17, 2009 10:12am

Health Care ETFs Have Been Taking The Long Way Home

healthcare3It's been rather startling to watch the equity markets make a run at 6 consecutive weeks of gains. Weren't folks all but promising Dow 5000 back at Dow 6500? Didn't the S&P 500's 666 mark seem so ominous... that the index appeared destined for 500? Scores of bears haven't thrown in the towel. And pullback believers, including myself, are almost praying for a bit of profit taking. (Nothing truly wonderful ever seems to come from straight-line upward movement, just as nothing apocalyptic ever seems to come from free falling markets.)  Yet with Noubini predicting the S&P 500 to bottom at 600 as well as predicting the economy to be stuck in recession throughout 2010, market doom-n-gloom doesn't seem quite as "doomy-n-gloomy." Fits and starts... sure. Retesting and rethinking... it seems quite probable. But the idea of breaking the March lows feels less likely than setting higher lows in the 700s for the S&P. Regardless of how it all shakes out, one has to question what happened to the health care sector. In the bear's 18-month reign of terror, health care had arguably held up the best. Take a look at Vanguard Health Care ETF (VHT) versus ETF sector funds like Tech (XLK), Energy (XLE), Consumer (XLY), Utilities (XLU) and Materials (XLB). Full Story:  http://www.etfexpert.com/etf_expert/2009/04/etf-expert-health-care-etfs-have-been-taking-a-longer-road-home.html
ETF BASIC NEWS April 17, 2009 9:43am

ETF and ETP assets around the world have started to rise again

upBarclays Global Investors' latest ETF Industry Preview, released earlier today, shows that ETF and ETP assets around the world have started to rise again, after a lengthy dip from the peak recorded at the end of 2007.  Whether this is a sustainable trend is another matter, as Debbie Fuhr's team's figures show that 80% of global ETF assets were in equities at the end of March.  With ETF assets worldwide totalling $634 billion at the latest count, Fuhr's oft-stated target of $2 trillion under management by 2011 seems heavily dependent on the share markets rebounding. As BGI states elsewhere in the document, European ETF assets have grown more quickly than the US ETF market did during the earliest years of its development - something that's unsurprising.  But there is one area where the US and European ETF markets have converged quite neatly - and that's in the level of fees charged. BGI shows that the average total expense ratio ("TER") for US ETFs at the end of February 2009 was 31 basis points.  In Europe the average TER was - 31 basis points. Full Story: http://www.indexuniverse.com/blog/5704-fee-convergence-and-asset-levels.html Related documents: BARCLAYS ETF REVIEW FEBRUARY 2009: http://eu.ishares.com/publish/repository/documents/en/downloads/etf_landscape_february_09_en.pdf
ETF BASIC NEWS April 17, 2009 9:22am

Potential launch of first U.S. ETF backed by Platinum holds promise

platinum11These ETFs would be a "huge boon for retail investment into the PGMs (platinum group metals)," said Scott Wright, an analyst at financial-services company Zeal LLC. Indeed, the timing may be just right. Prices for platinum and palladium have been climbing from lows hit late last year. Platinum prices have gained more than 60% from their low in October of last year to trade as high as $1,247 an ounce this week on the Comex division of the New York Mercantile Exchange. Palladium's up close to 50% from its December low to a high above $242 an ounce this week. ETF Securities USA will sponsor the ETFS palladium trust and the ETFS platinum trust, according to separate Securities and Exchange Commission filings dated April 2. The sponsor, the largest provider of exchange-traded commodities, declined to comment on the filings. Still, it's easy to speculate over the reason behind the move. Setting an example In the U.S., the silver- and gold-backed ETFs have "ultimately reshaped the fundamentals of the precious metals markets," said Wright. The launch of the iShares silver ETF "happened in the face of aggressive opposition from the industrial sector," he said. It was launched in April of 2006. But now the ETF holds over 270 million ounces, "the equivalent of nearly half a year's worth of global mined production," said Wright. And the SPDR Gold Trust, launched in late 2004, is now one of the largest ETFs in the world, he said. It's the sixth-largest gold owner and gold held in the trust recently surpassed the quantity held by the Swiss central bank, he said.
 
 
ETF BASIC NEWS April 17, 2009 9:09am

SPDR GLD ETF holds more Gold than Swiss, China, and Russia reserves

gold(original story March 2009) The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust GLD, said it held a record 1,041.53 tonnes of bullion as of March 12, replacing Switzerland as the world's sixth-largest holder of gold. SPDR's record stake, up 3.36 tonnes or 0.3 percent from the previous day, topped the 1,040.1 tonnes of gold listed as held by Switzerland in December, the latest data from the World Gold Council showed. Switzerland ranked as the world's sxth-biggest official gold holder after the United States, Germany, International Monetary Fund, France and Italy. "The most significant factor for the precious market this year is that long-term, stable funds have been entering the ETF in a systemic way," said Yukuji Sonoda, precious metals analyst at Daiichi Commodities in Tokyo. "Driven by worries about currencies, among others, ETF's increases have become symbolic of a market rise, and the market is hoping that the ETF's resumed climb will help pull up prices." goldchart   Full Story: http://af.reuters.com/article/commoditiesNews/idAFT14717920090313
ETF BASIC NEWS April 16, 2009 2:13pm

Hedging Home Value With ETFs: How to Buy & Sell a Home on the NYSE

housingNo one’s talking about one of the most interesting developments in real estate this year. And it’s not the plummeting home prices, or the spike in foreclosures. Your home could lose half its value this year - since January 2007, countless have. And like many Americans who’ve seen their biggest asset depreciate, you’ve been completely defenseless, unable to stop it. But that’s about to change. I’m not suggesting the freefall in prices will stop. The latest reading of the S&P/Case-Shiller Composite 10 House Price Index makes it impossible to advance such an argument. (It’s dropped for the twenty-fifth consecutive month.) Instead, I’m telling you we’ll finally have a way to profit from retreating prices. In other words, we can finally hedge home value in one simple step - through the use of exchange traded funds or ETFs. Let me explain how… A Rare IPO for Two ETFs After five years in the planning stage, later this month, a pair of ETFs - the MacroShares Major Metro Housing Up (NYSE: UMM) and MacroShares Major Metro Housing Down (NYSE: DMM) - will IPO. Full Story: http://jutiagroup.com/2009/04/16/hedging-home-value-with-etfs-how-to-buy-sell-a-home-on-the-nyse/
ETF BASIC NEWS April 16, 2009 1:54pm

iShares Lending Profits Not Barclays’ To Sell

money1By Ian Salisbury OF DOW JONES NEWSWIRES NEW YORK (Dow Jones)--When Barclays PLC (BCS) sold its prized iShares exchange-traded fund business earlier this month, much of the speculation was about whether the deal would include revenue from a lucrative side business - lending out stocks owned by iShares funds. In fact, that aspect of iShares' business wasn't really Barclays' to sell. Profits from lending out shares of the ETFs belong to the funds' shareholders, not to Barclays or to CVC Capital Partners, the proposed buyer of iShares. Borrowed shares are typically used by short sellers, such as hedge funds, who pay a fee for the chance to sell the shares on the open market and, with luck, repurchase them later at a lower price. Barclays does, in fact, earn money from iShares' securities lending, but that's because it received a contract for the work from iShares' board, a group of trustees meant to look out for fund shareholders' interests. While Barclays could in theory sell the separate business unit that holds the contract and which also handles securities lending for Barclays' larger institutional money management unit, Barclays can't promise CVC that the business unit will keep its ties with iShares. "There are a lot of people that do securities lending, and the iShares board could hire somebody else," says John McGuire, a partner at law firm Morgan Lewis in Washington, who specializes in mutual fund regulations. Of course, Barclays' double role - which the confusion around its sale serves to highlight - could raise questions about self-dealing. Barclays' commission on iShares' securities lending revenue - 50% - appears hefty. But with the market for securities lending basically opaque, it's difficult to judge whether iShares holders are really getting a fair deal or not. Full Story: http://online.wsj.com/article/BT-CO-20090416-713254.html
ETF BASIC NEWS April 16, 2009 1:38pm

ETF Mutual Fund (ETFOX) Adjusts Portfolio In Response to Market

fidelityIn a follow up interview with Fidelity Independent Adviser, released today, ETF Market Opportunity Fund (ETFOX) manager discusses recent changes to his portfolio and his reaction to recent market events. Since its selection as Fidelity Independent Adviser’s Best Fund for Second Quarter 2009, Paul Frank’s ETF Market Opportunity Fund (ETFOX) has continued to beat the S&P 500. While Frank’s ETF based mutual fund has grown dramatically, his methodology has remained consistent, and he continues to attribute his success to both the transparency of ETFs and the fundamental oversight that a mutual fund provides. Q: How have recent market conditions, including the March rally, impacted the composition of your portfolio? A: ETFOX is designed to react to market movement, so several of my positions have changed along with the market in recent weeks. My model led me to trim my exposure to fixed income, and while I dropped the Proshares UltraShort 20+ Year Treasury Fund (TBT) in March, I began buying shares again on April 14. At the beginning of the March rally, I added large-value ETFs to the fund but have since moved to small cap growth. Technology ETFs have performed well, and I have added Vanguard Information Technology ETF (VGT) to the fund while increasing my position in iShares S&P North American Tech-Semiconductors (IGW). The core of ETFOX is still large growth funds. Full Story: http://www.pr-inside.com/etf-mutual-fund-etfox-adjusts-portfolio-r1187173.htm
ETF BASIC NEWS April 16, 2009 1:16pm

ETFs: Smooth Sailing Gives Way to Choppy Waters

brazilAfter 6 weeks of smooth sailing, options traders are anticipating volatility in emerging-market exchange-traded funds. Activity spiked yesterday in the MSCI Brazil Index (EWZ) and MSCI Emerging Markets Index (EEM), which both witnessed above-average volume. In 1 of the session's largest trades, an investor purchased 33,000 contracts of EEM May 28 puts for $1.69 and an equal number of May 28 calls for $1.49. This so-called straddle trade will be profitable if EEM falls below $24.82, or rises above $31.18. EEM rose 1.45% yesterday to close at $28.07. (See optionMONSTER's Education section.) Another large transaction showed how 1 trader bet on a limited decline at very low cost. This strategy bought 5,000 May 26 puts in EEM for $0.96 and sold 10,000 May 24 puts at an average price of $0.465. By selling more puts at the lower strike, the cost was reduced to just $15,000 before commissions. Full Story:  http://www.minyanville.com/articles/markets-EEM-SP500-efa-INDEX-Japan/index/a/22220/from/yahoo
NYSE:EEM April 16, 2009 10:52am

SSgA Plans VRDO Muni Bond ETF

munibondWith market volatility still a concern and Treasury yields relatively low, State Street Global Advisors has filed to launch a new municipal bond exchange-traded fund. The SPDR S&P Municipal VRDO ETF will track an index of variable rate demand obligations. Those are debt issues by states, local governments and other agencies which pay interest exempt from federal income taxes. VRDO issuing volume skyrocketed last year after the collapse of the auction-rate securities market. Those types of fixed-income issues are similar to VRDOs since they each have long-term maturities but reset frequently, giving both types of securities short-term interest rate features. But VRDOs are considered more flexible since they allow put options as rates change. Full Story: http://www.indexuniverse.com/sections/newsinfocus/5696-ssga-plans-vrdo-muni-bond-etf.html
ETF BASIC NEWS April 16, 2009 10:52am

PRECIOUS-Gold treads water at $890/oz, ETF holdings unchanged

3-16-09-gold-125x125* Gold little changed after weak China GDP data * SPDR Gold Trust GLD holdings stay at record high (Updates prices, releads, adds quotes) By Risa Maeda  TOKYO, April 16 (Reuters) - Gold was little changed around $890 per ounce on Thursday, torn between weakening stock markets and a lack of strong physical buying.  Bullion earlier got a boost when Asian stocks pared gains as investors cash in profits after China posted its slowest quarterly growth ever.  But European stocks futures indicate a higher opening later in the day, which may keep gold traders from making bullish bets. [ID:nLG653897]  "Investors seem to be closely watching developments in stock markets for any further clues. It isn't clear whether it's a bear market rally or a fresh rally in the beginning," said Pradeep Unni, trader at Richcomm Global Services.  Gold is still stuck in a range, with $885 on the downside and $900 on the higher side, he added.  Spot gold <XAU=> stood at $891.20 per ounce at 0625 GMT, up 0.1 percent from New York's notional close of $890.60.  It last closed above $900 on April 2 before hitting a 10-week low of $864.30 last week. Full Story: http://www.reuters.com/article/goldMktRpt/idUSSP11262520090416
ETF BASIC NEWS April 16, 2009 10:35am

J.P. Morgan Chase results give banks a fresh lift

jpmorganNEW YORK (MarketWatch) -- Financial results reported by J.P. Morgan Chase & Co. that topped analyst estimates kept bank stocks' recent rally running Thursday. The KBW Banking ETF (BKX), the exchange-traded fund that acts as a benchmark for the sector, rose 1.4% in early action and helped the broader financials post a roughly 1% gain. J.P. Morgan Chase's first-quarter profit slipped 10% from the year ago period as credit losses and provisions rose, but the blue-chip bank  (JPM) posted a profit in stock and bond trading -- suggesting that markets, particularly the credit market, are coming back to life, albeit with massive government help Full Story: http://www.marketwatch.com/news/story/story.aspx?guid=%7B8E230FCA%2DB717%2D4919%2D9C6D%2D07BCAF2A967F%7D&siteid=rss
ETF BASIC NEWS April 16, 2009 10:26am

State Street Introduces First Convertible Bond Exchange Traded Fund

statestreetState Street Global Advisors (SSgA), the investment management arm of State Street Corporation STT, today announced that the SPDR® Barclays Capital Convertible Bond ETF (Symbol: CWB) began trading on the NYSE Arca on April 16, 2009. It is the first convertible bond ETF available to U.S. investors. The SPDR Barclays Capital Convertible Bond ETF seeks to track the price and yield performance of the Barclays Capital U.S. Convertible Bond >$500MM Index (the “Convertible Index”). Convertible bonds are bonds that can be exchanged, at the option of the holder, for a specific number of shares of the issuer’s preferred or common stock. As of December 31, 2008, 156 issues were included in the Convertible Index. The Fund’s expense ratio is 0.40 percent. “Offering a unique risk-return profile that combines the yield of corporate bonds with the capital appreciation potential of stocks, convertible bond exposure is experiencing increased demand as investors look to improve the diversification of their portfolios,” said James Ross, senior managing director at State Street Global Advisors. “As the first ETF to provide exposure to the benefits of convertible bonds, the SPDR Barclays Capital Convertible Bond ETF underscores our commitment to develop innovative ETFs for investors seeking precise access to all segments of the market.”
ETF BASIC NEWS April 16, 2009 10:00am

Could a New Platinum ETF Send Prices Haywire?

platinum3The United States’ first platinum ETF is in registration. Ahead of the fund’s launch are some warnings for investors about the popular metal. Investors who are bullish on platinum now have an ETF in the works that could create demand for the metal, as each share must have a corresponding quantity of the precious metal behind it, Liam Denning for The Wall Street Journal explains. The filing for the U.S. fund was made by ETF Securities, which has a platinum fund in London right now. Since the prospective ETF first filed, platinum is up 5%, and has been up 51% since its November low. The metals had been suffering, because the auto industry hit platinum where it hurts - catalytic converters for cars make up 55% of the world’s total platinum demand. Full Story:  http://seekingalpha.com/article/131202-could-a-new-platinum-etf-send-prices-haywire
ETF BASIC NEWS April 16, 2009 10:00am

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