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Investors Betting On Gaming ETF – Saturday March 21, 2009

casino Political maneuvers in Washington, D.C., and Beijing are driving renewed interest in the gaming industry. And that's translating into a surge in assets for the Market Vectors Gaming ETF (NYSE:BJK - News). The exchange-traded fund's assets have jumped from just $2 million on March 6 to $15 million today. But trading volume has been even more impressive:While activity limped along at 1,000-3,000 shares per day in January and February, it exploded to the upside starting on March 9. Such an upturn comes following a series of corporate and political moves that could leave casinos and related gaming firms poised to reap significant rewards, according to portfolio managers and analysts. "Something's definitely happening," said Adam Phillips, managing director of Van Eck Global's Market Vectors unit. "It could be an early-stage U.S. economic recovery play or simply renewed strength in the gaming sector based on specific company fundamental outlooks." Movements are taking place on both fronts. Interest in the gaming sector started picking up on March 4, when the chief executive of Las Vegas Sands Corp. (NYSE:LVS - News) said the casino operator wouldn't have to default on its debt obligations. In a Reuters report late the day before, Sheldon Adelson credited a combination of cost-cutting moves and increased business in Macau, China's booming casino mecca. The company has two casinos in the Chinese city. The CEO, speaking at a Reuters-sponsored conference, was bullish on an upturn in travel to Macau. Adelson felt confident about a pickup in business "based on recent Chinese media reports suggesting that the governments of Hong Kong, Macau, and Guangdong province have decided to lift the restrictions," the article added. Shares of LVS have jumped from a closing price of $2.19 on March 2 to end at $2.57 on Thursday. Around the same time, Rep. Barney Frank (D-Mass.) held a press conference in which he complained that the three-year-old ban on Internet trading was hurting trading activities between the U.S. and Europe. At that time, he also laid out plans to start working towards presenting legislation to overturn those restrictions. Broad-Based Rally? Robert Stein, chief investment officer at Astor Financial, has been watching the ETF's recent climb. The adviser and portfolio manager, who was trained as an economist and takes a top-down approach to analyzing sectors as well as macroeconomic conditions, believes BJK's rising fortunes are broad-based. He said that while the gaming industry has been battered by the recession, it has actually held up relatively well compared with many other sectors. "As a result, some analysts are starting to speculate that more discretionary income will go into the sector in the future," said Stein. "If that plays out, BJK could definitely benefit from a broader-based economic recovery." In fact, he notes that stock markets in the U.S. started showing signs of improvement around March 6, when the major indexes seemed to bottom out in terms of intraday lows. "A lot of other areas in the market besides gaming have picked up some traction since that point," added Stein. "So this move into BJK probably isn't just short-term traders." But not everyone is eager to rush into the sector yet. That includes managers at the Financial Enhancement Group. "We have been avoiding the gaming stocks and will for some time," said Adam Harter, one of the firm's analysts. "Demographically speaking, we feel the business model had some flaws given the spending patterns and age composition of our country at this time." Jerry Slusiewicz, president of Pacific Financial Planners, says BJK nonetheless looks attractive from a technical standpoint. "It looks like this ETF has really formed a truer double bottom than the rest of the market," he said. A so-called double bottom formation is viewed as a very positive signal in technical analysis. "There's a lot of support around $13.20 for BJK (which closed up on Friday at $15.97)," said Slusiewicz. "So the downside could be around 16% from this point. I would definitely use stop losses around there to limit risks if you're interested in jumping into this ETF." He warns that the ETF's top four holdings comprise nearly a third of its portfolio. But a plus for the portfolio is that more than 70% of its assets are in foreign stocks. "That could be another catalyst for BJK since emerging markets stand to outperform in any prolonged global economic rebound," said Slusiewicz. Slusiewicz notes that, as an institutional investor who blocks trades for high net worth clients, the recent uptick in volume for BJK isn't great enough to ease his liquidity concerns. "If I were to take a position in this ETF, we'd wind up owning several days worth of shares based on current trading volume. It would still just be too difficult to get out of that position if we had to for any reason," he said. But for smaller investors, Slusiewicz likes the prospects for BJK going forward. He says that various sets of other data besides volume and asset numbers indicate institutions are jumping into the gaming sector through the Market Vectors ETF. "It's like watching an elephant jump into a relatively small pond," he said. "It's making a big splash, and you can see that through exploding trading volume and rising assets." The sector is also still undervalued, adds Slusiewicz. "The whole industry is very cheap. Look at Las Vegas Sands. It was trading at $106 a share at one point in 2008. Now that's down to less than $3 a share," he said. "And it's a big company with a market cap of $1.7 billion right now. So we're not talking about chump change." Source:  www.yahoo.com
NYSE:BJK March 21, 2009 5:28pm

ETF WEEK IN REVIEW Friday March 20, 2009

bearbull21 (smartmoney.com) Winners

As crude oil stayed above $51 a barrel, the United States Oil fund (USO: 30.76, +0.40, +1.31%) picked up 14.1% for the week. The SPDR S&P Oil & Gas Exploration & Production fund (XOP: 27.59, -1.33, -4.59%) gained 9.4%.

Losers

Investors fled risky housing-related and real estate funds after signs this week those industries still have a ways to go on the road to recovery. The SPDR DJ Wilshire REIT fund (RWR: 24.60, -2.28, -8.48%) shed 13% over the week, while the iShares Cohen & Steers Realty Majors Index (ICF: 26.81, -2.57, -8.74%) fund lost 11.5%.

This Week’s Industry News

Closings Six MarketGrader ETFs will be shut down, sponsor SPA ETFs announced Monday. Three exchange-traded notes issued by Credit Suisse Securities will cease trading on the New York Stock Exchange by April 3 because of insufficient trading volumes. The Elements MLCX Gold Index ETN (GOE: 58.00, -2.15, -3.57%), Elements MLCX Livestock Index ETN (LSO: 7.99, +0.05, +0.62%) and Elements MLCX Precious Metals Plus Index (PMY: 8.00, -0.32, -3.84%) will close, but Credit Suisse said it will continue to list its Elements Credit Suisse Global Warming ETN (GWO: 4.40, +0.00, +0.00%).

ETF BASIC NEWS March 20, 2009 10:44pm

Short ETF’s Soar As The Bulls Crawl Back Into A Hole

stocks-plungeStocks gave up gains before the weekend as the bears send the bulls hiding.  ETF Short "FAZ" soared today gaining 15% making me believe the bear attack is back.  My prediction of DOW 5000 is becoming a reality and the bear market rally has ceased for now!
  Despite Rally, Short ETFs Still Lead Wall Street Being short continues to be all the rage, based upon Forbes’ Short Term PowerRatings. Despite a significant rally in equities, short ETFs still hold their place as the leader in today’s stock market. The Short Term PowerRatings attempts to find stocks that are performing well against the market as a whole. After closing in on a near two week rally, short ETFs are still dominating long ETFs and stocks as the best investment on Wall Street. Writing for Forbes, David Penn, senior editor of TradingMarkets, found very few stocks that could be substituted for some of the high-flying short ETFs on the Short Term PowerRatings list. “The fear of losing gains to a sudden reversal is what will eventually lead to the profit-taking that will bring stocks lower and short ETFs higher,” he said. Eighteen funds from the PowerRatings list posted gains of greater than 30% in the past year, with all of them being short or inversed investments.  By:  March 19, 2009 at 2:05 pm by ETF.com
NYSE:FAZ March 20, 2009 4:29pm

How Can Jim Cramer Blame The Financial Crisis On An ETF?

jim-cramer Jim Cramer has been consistently saying that "SKF" is the reason for the run on the banks.  These short ETF's have been very popular during the bear market raids!  Could these short ETF's including the 3X short "FAZ" be the reason for the run on the banks? -Administrator
Friday, 6 Mar 2009  www.cnbc.com Cramer’s Outrage: Short Sellers, the SKF and the SEC Cramer is directing the same level of energy toward eliminating ultra-short ETFs as he did in demanding the Federal Reserve open the discount window back in August 2007. (You all remember “They know nothing!” right? ) Regular Mad Money viewers have heard his calls to the SEC before. He wants the UltraShort Financials ProShares [SKF 125.35 6.25 (+5.25%) ] fund shut down because short traders are using it to hammer down financials stocks virtually unchecked. This is the fund that turns a $1 investment into $3 – an SEC-approved skirting of its own margin rules – putting even more pressure on the banks than the credit crisis has. That, of course, is why the shorts like the SKF so much. They’re kicking the sector when it’s already down, making a hefty profit in process. Watch the video for Cramer’s in-depth analysis. He puts the importance of short-selling rules in historical context – as in, lessons learned from the Great Depression – debunks the reasoning that former SEC Chairman Christopher Cox used to get rid of them, and explains how the SKF is aiding in the destruction of Citigroup [C 2.65 0.05 (+1.92%) ], Bank of America [BAC 6.2099 -0.7201 (-10.39%) ], Wells Fargo [WFC 14.40 -1.02 (-6.61%) ], US Bancorp [USB 13.76 -0.50 (-3.51%) ] and many other banks.     Videos: http://www.cnbc.com/id/29553202
NYSE:SKF March 20, 2009 10:20am

XLF down as the bears bite back at financial stocks!

black-bear
By MarketWatch www.marketwatch.com
BOSTON (MarketWatch) -- The U.S. financial sector couldn't hold on to early gains Thursday and fell into the red as the rally in banking stocks fizzled even in the wake of news the Federal Reserve would pump trillions of dollars into the mortgage and bond markets to jumpstart the economy.
Citigroup Inc.  C shares rose early in the session but reversed course and were off about 6% in afternoon trade. The company announced a plan to convert preferred shares into common stock to boost its capital.
In the broader financial sector, the Financial Select Sector SPDR Fund  XLF was down about 4% in recent action.
Citi in a Securities and Exchange Commission filing Thursday said that it has reached definitive agreements with private preferred shareholders to convert $12.5 billion of the securities into common shares.
Citi was also making headlines Thursday that could further inflame public anger over how financial institutions are spending bailout money they have received from the government. Citigroup plans to spend about $10 million on new offices for senior executives, according to a published report Thursday. Citigroup has also reportedly canceled orders for private jets for top executives.
Insurance stocks were weak Thursday after Moody's cut Prudential Financial Services Inc.'s PRU  credit rating.
"The financial profile of Prudential continues to be hurt by its very substantial exposure to the variable annuity business with guarantees, as well as by the increased losses from its investment portfolio," Moody's said in a statement.
Prudential shares were off more than 15%. Lincoln National Corp.  LNC fell 9% and MetLife Inc MET shed 8%.
In earnings news, Discover Financial Services  DFS  said it was profitable in the first quarter, but the firm slashed its dividend. See complete coverage. End of Story
 
NYSE:XLF March 19, 2009 3:34pm

How Does the Fed ‘Print Money’?

print-money by: Kathy Lien March 19, 2009  www.seekingalpha.com With the Fed’s announcement Wednesday, many people may be wondering “How does the Fed print money?” Here is a snippet from my Daily Piece on Currencies. Most of the time when we say that a central bank “prints money” that does not mean that they actually fire up the electronic version of a printing press. They can and this is the way Bernanke described it in 2002 when he said that “The U.S. government has a technology, called a printing press (or, today, its electronic equivalent), that allows it to produce as many U.S. dollars as it wishes at essentially no cost. By increasing the number of U.S. dollars in circulation, or even by credibly threatening to do so, the U.S. government can also reduce the value of a dollar in terms of goods and services, which is equivalent to raising the prices in dollars of those goods and services. We conclude that, under a paper-money system, a determined government can always generate higher spending and hence positive inflation.” However more often printing money means that the Federal Reserve will issue more debt by selling Treasury bills to raise money to buy in this case, longer term Treasuries. Usually, the buying far exceeds the selling, which increases the money supply. Unfortunately by increasing the supply of dollars, each dollar is worth less. The U.S. government also increases its debt burden, raising concerns for foreign investors. This is compounded by the fact that the Fed’s purchases of Treasuries will drive down bond yields, reducing the attractive of dollar denominated investments.
ETF BASIC NEWS March 19, 2009 2:13pm

GLD Soars on Fed Announcement; Headed for All-Time Highs

images March 19, 2009  by: www.seekingalpha.com With there already having been countless stories written about the Fed’s actions on Wednesday, I thought it would be helpful to point out one of the least heralded facts from Wednesday’s crazy day of trading: In less than two hours after the Fed announcement, the SPDR Gold Shares (GLD) trading volume soared, trading over 40 million shares. Average volume for the GLD ETF over the past 60 days has been 24 million shares a day. Yesterday’s major accumulation day means that the bulls are firmly back in control, positioning GLD to make a run at $1,000 and all-time highs in the coming weeks/months. Yesterday’s volume on GLD was 59.5 million shares. In the span of a few weeks, GLD has gone from being CNBC’s darling to now being the forgotten child, with market pros instead choosing air time with persistent calls of a bottom for equities. While the Market Vane Bullishness figures continue to remain high on Gold in the short term, I think they will go even higher as the commodity and the GLD ETF both work toward recent highs and then through their all-time highs. As is seen in all bull markets, demand has powerfully overtaken supply. A look at the 60 day/120 minute timeframe on the chart below shows just how forceful volume was yesterday afternoon on the GLD:
NYSE:GLD March 19, 2009 12:21pm

What Latest Fed Move Means for ETFs

saupload_images30 March 18, 2009  by: www.seekingalpha.com How does the Federal Reserve’s statement today affect Treasury bonds and exchange traded funds (ETFs) that hold the government debt? The Federal Reserve announced midday that it will begin large-scale purchases of 30-year Treasury Bonds to the tune of $300 billion over the next six months, reports David Goldman for CNN Money. This would help the government accomplish two goals, according to many economists:
  1. Lower interest rates on corporate debt and mortgage loans
  2. Maintain a critical level of support for the bond market to keep values higher
Federal Reserve Chairman Ben Bernanke has made statements that the central bank will use “all the tools” available to revive economic growth, so this move had been expected. Bernanke also left a key short-term bank lending rate at a record low of between zero and 0.25%. Since interest rates fall as bond prices rise, the money going into 30-year bonds would help push down yields. They’ve been inching up toward 4% after falling to near 2.5% in December. Additionally, by sending prices up, the central bank could help lure more buyers to help prop up a slumping market. Meanwhile, Bill Gross, manager of Pacific Investment Management Co.’s $138 billion Total Return Fund, upped his holdings of U.S. government debt 15%, the highest percentage since last July 2007, reports Dakin Campbell for Bloomberg. While the government debt category includes Treasuries, Gross has said in the past that PIMCO is not interested in buying the securities. In February, Gross said it was dependent upon the Federal Reserve to buy Treasuries but that he wouldn’t follow the central bank’s lead.
ETF BASIC NEWS March 18, 2009 5:22pm

AdvisorShares Introduces a “Doom and Gloom” ETF

3-13-09-doom-and-gloom-125x1251March 13, 2009 at 2:05 pm by ETF.com Wall Street may soon open its doors to the first official “doom and gloom” ETF. Harry Dent, best known for predicting the tech bubble in the late 1990s and penning the recent book, The Great Depression Ahead, will soon get his own exchange-traded fund
ETF BASIC NEWS March 18, 2009 2:26pm

Barclays Deliberates Sale of iShares ETFs

3-16-09-barclays-125x125March 16, 2009 at 2:13 pm by ETF.com Amid a financial crisis that has left Barclays searching for possible sources of additional capital, the company is considering selling the iShares brand to raise quick cash. The funds, which make up more than 45% of all ETF market holdings, are one of Barclays most successful and fastest growing businesses. Dow Jones reports that the sale could tally billions of dollars, with one industry analyst valuing the iShares brand at $5.6 billion. Finding a buyer, however, may prove to be more difficult, with many possible purchasers already in financial trouble. At present, it is not known whether the sale would involve the entire iShares brand or if Barclays would seek a minority stake. Barclays has yet to reach a decision regarding the sale of iShares; however, senior equity analyst at Morningstar, Erin Davis, argued “Barclays is pretty desperate to avoid a government stake, so it might cut off its nose to spite its face.”
ETF BASIC NEWS March 18, 2009 1:54pm

GLD Sixth Largest Holder of Gold in the World!

3-16-09-gold-125x125 March 16, 2009 at 2:21 pm by ETF.com Investor interest in the metal has skyrocketed, with the second largest US based ETF, SPDR Gold Trust (GLD: Quote, Profile, Advanced Chart, News), showing growth in assets of 33% in 2009 alone on modest gains of $50 or 5.2% per ounce. GLD is now the sixth-largest holder of gold in the world after displacing the Swiss National Bank. The survey of analysts, which has correctly predicted the weekly change in gold 59% of the time, is a key indicator for Bloomberg in gauging future momentum in the metals market. Gold ETFs are among the few to rise in 2009, along with other precious metal funds and safe haven investments. In a weekly survey of 30 traders around the world, 20 advised buying the precious metal, with six analysts holding a neutral position and only four advising investors to sell.
NYSE:GLD March 18, 2009 1:38pm

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