All ETF Daily News Articles

Barclays Global Investors Buys Mexico’s Naftrac ETF Program

mexicoMEXICO CITY (Dow Jones)--Barclays Global Investors said Thursday that it has purchased Mexican state development bank Nafin's Naftrac exchange traded funds program for an undisclosed amount. In a press release, Barclays Global Investors said the deal makes its iShares family of ETFs the largest provider of ETFs based in Latin America. Barclays Global Investors said Naftrac has been renamed iShares Naftrac...... ......"In the coming months, we will intensify our efforts to develop and broaden our presence in Mexico," Daniel Gamba, Barclays Global Investors' director for Latin America and the Caribbean, said in the press release. Full Story:
ETF BASIC NEWS May 14, 2009 2:06pm

An ETF For Every Investor!

etf-newsIn last week’s Money and Markets column, I told you about the advantages exchange-traded funds have over mutual funds. Today we’ll go a little deeper and look at the many exciting ways you can execute your investment ideas with ETFs.  As you’ll see, practically all the new financial innovation is happening in the ETF niche. Mutual fund sponsors have all but given up on doing anything new and different. The first thing I want you to understand is that an ETF is nothing more than a tool. And most of the time, ETFs do what they’re designed to do. The more important question is which ETF is a match for your goals and situation? The ETF that works for your neighbor might not be the same one that you need. Adding ETFs to your toolbox is a terrific way to implement your investment strategy. So what are your goals? If you have a well-designed investment strategy, you’ll still need good tools to execute that strategy. And ETFs are a great way to fill up your toolbox.  Just look at some of the ways ETFs allow you to invest … Market Benchmarks: If you’re a broad-minded investor who wants to play the whole market, you can easily do it with ETFs. The iShares MSCI ACWI Index Fund (ACWI) tracks the MSCI All-Country World Index — which includes just about every stock market in the world: U.S., Europe, Asia, Emerging Markets, 46 countries in all. ACWI is one-stop shopping for equity investors. Style Investing: Do you think small-caps will outperform? Consider iShares Russell 2000 Index Fund (IWM), which lets you buy all 2,000 stocks in this popular index with one, quick transaction. Or if you’re looking to tilt your portfolio toward value stocks, or growth stocks, or dividend-paying stocks, you have plenty of ETFs to choose from. Sector ETFs: These are some of my favorites. You know that different industries tend to rotate in and out of favor: Technology, health care, retailers, utilities, and more. ETFs let you own the hot sectors and also give you a way to zero in on the best sub-sectors. Within the technology sector, for instance, there are ETFs that cover semiconductors, computer hardware, software, information services, networking, telecommunications and more. International: For years investors had to use mutual funds in order to invest outside the U.S. Fund sponsors covered broad regions, but to get any more precise you had to buy individual stocks. Not any longer. ETFs now cover not only the major regions of the world — Europe, Asia/Pacific, Latin America and so on — but also many individual countries. Whether you want to buy Singapore, Switzerland, or South Africa … ETFs let you do it. Try that with a mutual fund! Full Story:
ETF BASIC NEWS May 14, 2009 2:04pm

ETF inflation trades

NYSE:GLD May 14, 2009 1:41pm

Shorting both FAS and FAZ for an 87% return?

idea( I’ve been playing around with ETFs for a while and thought about a way to generate a considerable profit from them. Option traders are familiar with time decay but it also applies to leveraged ETFs. This ETF time decay is a result of the fund management fees, leverage financing interests and other expenses. Since November 2008, there are 2 interesting funds for this strategy: The Direxion Financial 3X ETFs. FAS is long the financial market and FAZ is short the financial market, both using 300% leverage. These ETFs are very popular and are traded in the tens of millions shares a day which make them good candidates for short selling. While I was looking around for information on this strategy, some people rightfully said “they cannot go both to 0”. This may be true but that’s not the object of this strategy. Here, we want to re-hedge the positions daily to balance the dollar amount on FAS and FAZ. This way, we profit from the downward bias on both funds and we are hedged against the market since the net delta of this position is near 0 and readjusted to 0 every day.

The strategy is: everyday, at close time, balance the positions on FAS and FAZ to have the same short dollar amount resulting in a net delta of 0. A quick backtest starting with a short position of $5000 on each ETF shows......

Full Story:

NYSE:FAS May 14, 2009 12:33pm

Invesco PowerShares Recognized With ETF Industry Awards

powersharesCHICAGO, IL--(Marketwire - May 14, 2009) - Invesco PowerShares, a leading provider of exchange-traded funds (ETFs) was recognized for launching the "Most Innovative ETF Product" in 2008 and for its ongoing "Contribution to the ETF Sector" at two ETF industry conferences held recently in New York City. Invesco PowerShares received the 2008 award for "Most Innovative ETF Product" for the Americas at the 5th Annual Global ETF Awards®. Invesco PowerShares introduced the industry's first actively managed equity ETFs in April 2008, listing the PowerShares Active Mega Cap Fund (PMA), PowerShares Active AlphaQ Fund (PQY), and PowerShares Active Multi-Cap Fund (PQZ). As part of the same listing, Invesco PowerShares also launched the PowerShares Active Low Duration Fund (PLK), and in November 2008, the company listed the first actively managed U.S. Real Estate ETF -- PowerShares Active U.S. Real Estate Fund (PSR). Actively managed ETFs combine the goals associated with active management (reduced volatility, managed risk and benchmark outperformance) with the traditional benefits of ETFs, such as tax efficiency and transparency. "It is truly an honor to be recognized by our peers as a leading innovator in the ETF Industry," said Bruce Bond, president and CEO of Invesco PowerShares. "We believe our diverse suite of ETF portfolios is at the forefront of the industry delivering value and market-leading ideas to investors." Separately, Edward McRedmond, senior vice president of portfolio strategies at Invesco PowerShares, was presented with the 2008 award for his "Contribution to the ETF Sector" at the 8th Annual Closed-End Fund & ETF Awards Capital Link Forum. This marks the second consecutive year Mr. McRedmond has received the award and the fifth consecutive year for Invesco PowerShares. "It's been my privilege to work and interact with so many wonderful and talented people in the ETF industry over the years," said McRedmond. "On behalf of Invesco PowerShares, I am deeply honored to be receiving the award for Contribution to the ETF Sector." Full Story:
ETF BASIC NEWS May 14, 2009 12:17pm

PRECIOUS-Gold steadies near $925 as dollar recovers, ETF up

3-16-09-gold-125x125TOKYO, May 14 (Reuters) - Gold held steady around $925 per ounce on Thursday as a recovery in the dollar dented sentiment, pushing prices below a six-week high touched the previous day on buying by gold-backed exchange-traded funds. Despite U.S. and euro zone data suggesting recent optimism about a global economic recovery may have been premature, gold struggled to extend gains as current prices were already seen as high, traders said. "Gold prices have been stabilising at relatively high levels, slowing fresh investment," said a senior trader at a Japanese smelter. "For gold prices to break above recent ranges, there has to be some fresh news about economic turmoil," he said. But gains in other commodities such as oil and base metals in recent weeks suggest gold will remain supported, keeping prices in the $915-$930 range for now, the senior trader said. Spot gold <XAU=> held steady at $924.00 per ounce, down 0.2 percent from New York's notional close of $925.45. It fell 0.4 percent to a low of $922.20 earlier on Thursday. On Wednesday, gold rose to a six-week high of $930.40 an ounce as buying by exchange-traded funds and losses in stock markets boosted interest in the metal. The world's largest gold-backed exchange-traded fund, the SPDR Gold Trust GLD, said holdings had risen to 1,105.62 tonnes as of May 13, up 1.53 tonnes from the previous business day for the first gain in a month. Full Story:
NYSE:GLD May 14, 2009 12:01pm

Commodity ETF’s Are The Best Place To Be For The Next Decade

commoditiesWhy invest in commodities? Two and a half billion people are going to live like Americans in the next 20 years and prices go up over time, that’s the nature of inflation. We are in the middle of a global economic crisis and commodities are on sale. Buy commodities now while they are still cheap. When we finally emerge from this global economic crisis — prices will explode higher. I’m talking about another long-term bull market in commodities. Let me explain… Inflation Will Push Commodities Prices Higher Our Federal Reserve Chairman Ben Bernanke is an inflationist, which is an advocate of the policy of deliberate inflation achieved by increasing the supply of available currency and credit. They call him helicopter Ben because he once quoted a statement made by Milton Friedman, about using a “helicopter drop” of money into the economy to fight deflation. Bernanke is a student of the causes of the Great Depression, and he has written extensively on this subject. Bernanke knows that deflation is quite negative for an economy and should be avoided at all costs. We have recently seen deflation as prices for real estate and commodities dropped during this recession. But, Ben Bernanke’s Fed and other central banks around the world have fired up the printing presses to combat deflation. They have been dumping new currency into the economy to reverse deflation and stimulate the economy. It’s working! One measure of inflation- the Consumer Price Index (CPI) has recently turned positive. Deflation is out—Inflation is starting. The problem is, inflation could really skyrocket, especially when we finally emerge from this recession.  Inflation eats away at your purchasing power and takes away your wealth. One of the best ways to protect against inflation is to invest in commodities.In the 1970s, when inflation in the U.S. was high and the economy was in a deep recession, commodity prices soared. You want to own tangible assets like metals, energy, agriculture, and livestock as these commodities hold their value in inflationary times. Full Story:
ETF BASIC NEWS May 14, 2009 11:11am

Growing Interest In UNG ETF Spurs Natural Gas Price Rally

natural-gasThe front-month natural gas NYMEX contract has rallied 45% since the end of April. The price rally has taken many by surprise because fundamentals have not changed. Industrial demand remains down, liquefied natural gas (LNG) imports are starting to show up and storage inventories will likely hit a new record this fall. Some analysts believe the rally in natural gas prices is due to a nearing economic recovery, but Energy Solutions, Inc. doubts that is the case. “History shows that natural gas prices rally in the second quarter of the year,” says Valerie Wood, President of Energy Solutions, Inc. “The rally usually starts a little earlier than it did this year, but it does tend to peak in May. So, the timing of this rally isn’t that much different from past years.” “Another factor driving this rally involves a little speculative déjà vu,” says Wood. There has been a surge of investor interest in United States Natural Gas Fund, LP (UNG), an exchange-traded fund. When UNG is purchased, the portfolio of products that make-up UNG are purchased. One of those products are natural gas NYMEX futures contracts. “If the purchase of UNG is aggressive, it can very well cause a quick rally in natural gas prices, which in turn increases the value of UNG and makes investors very happy. This prompts investors to throw more money at UNG, which could be a driving force behind another rally. This same type of investment happened last year, albeit with other types of funds,” says Wood. Full Story:
NYSE:UNG May 14, 2009 10:06am

Van Eck Launches Market Vectors Brazil Small-Cap ETF

brasilVan Eck Global today introduced the Market Vectors Brazil Small-Cap ETF (NYSE Arca: BRF), the first U.S.-listed exchange-traded fund (ETF) to focus on Brazilian small-cap stocks. BRF and its underlying index (Market Vectors Brazil Small-Cap Index, ticker: MVRIO) are designed to give investors exposure to domestic investment themes and opportunities, such as the growth potential in Brazil’s homebuilding and consumer goods sectors. “In our view, small-cap stocks represent excellent direct exposure to the Brazilian economy since small-caps are typically driven by local trends,” said Jan van Eck, Principal at Van Eck Global. “BRF is well diversified and avoids the heavy commodities and materials weightings of other Brazil-focused products currently on the market.” “Energy and Materials accounted for more than 50 percent of the weighting in the typical Brazil-focused index as of April 30th of this year,” continued van Eck. “By way of comparison, Energy and Materials made up just 16 percent of MVRIO at that same time. We believe that this makes BRF a unique product and one that will appeal to investors who are looking for a different type of exposure to Brazil’s local economy.” The top three industry weightings for BRF’s index are Household Durables, Food Products and Specialty Retail at 16%, 9% and 8%, respectively. Full Story:,824925.shtml
ETF BASIC NEWS May 14, 2009 9:51am

Industrial ETFs Ride the Economic Rebound

industryGeneral Electric, whose shares have climbed 17% in the past three months, is still down by more than half over the past year, suggesting there's plenty of room to rise. GE, United Technologies and 3M are the three-largest holdings of the Dow Jones U.S. Industrial Sector Index Fund(IYJ), which jumped 18% in April alone. The most attractive industrial ETF, based on its holdings' price-to-earnings ratio, is the PowerShares Dynamic Industrials Sector Portfolio (PRN), which owns only U.S. stocks. The fund's 60 members trade at an average of 11 times earnings. (Inverse and leveraged funds have been excluded from this review.) Holdings of PowerShares Dynamic Industrials Sector Portfolio include GT Solar International(SOLR), Chart Industries(GTLS), EnerSys(ENS), Flowserve(FLS) and Goodrich(GR). PowerShares Dynamic Industrials Sector Portfolio has fallen 0.6% so far this year, lagging behind some of its peers. First Trust Industrials/Producer Durables AlphaDEX Fund(FXR) has risen 5.6% over the same period, but is now potentially overvalued with a price-to-earnings ratio that's twice as high at 22. The best-performing international industrial ETFs this year are the SPDR S&P International Industrials Sector ETF(IPN), up 6.8%, and WisdomTree International Industrial Sector Fund(DDI), up 3.1%. Full Story:
ETF BASIC NEWS May 14, 2009 8:20am

Harvard Buys Korea, Brazil ETFs as Emerging Markets Beat U.S

harvardMay 14 (Bloomberg) -- Harvard University, the richest U.S. college, raised its holdings of exchange-traded funds that track stocks in Brazil, China and Mexico in the first quarter as emerging markets outperformed U.S. equities. The biggest new purchase reported by Harvard Management Co., which oversees the school’s $28.8 billion endowment, was 1.74 million shares of iShares MSCI South Korea Index Fund valued at $49 million, according to a filing yesterday with the U.S. Securities and Exchange Commission. Its largest stake was 8.28 million shares of iShares MSCI Emerging Markets Index valued at $205 million. The quarterly 13F filing, which doesn’t reflect all of Harvard’s equities, offers a glimpse of how the Cambridge, Massachusetts, school is navigating the worst financial crisis since the Great Depression. The MSCI Emerging Market Index rose 0.52 percent in the quarter, while the Standard & Poor’s 500 Index, a benchmark of U.S. stocks, fell 12 percent...... ......Vanguard Emerging Markets Harvard added to its ETF holdings in the quarter by buying 2.27 million shares of Vanguard Emerging Markets, as well as 1.5 million shares of iShares MSCI Brazil Index Fund and 1.14 million iShares FTSE/Xinhua China 25 Index Fund. Full Story:
ETF BASIC NEWS May 14, 2009 8:09am

Barclays Files To Launch Two Actively Managed ETFs

ishares_logoBarclays Global Investors' iShares group is apparently moving forward with plans to launch actively managed exchange-traded funds. In a filing dated May 4, BGI is requesting approval from the Securities and Exchange Commission to open two broad-based active ETFs. One would focus on stocks and the other on bonds. The exemption request was actually made on the behalf of two subsidiaries—Barclays Global Fund Advisors and iShares Inc. A third outside party, SEI Investments, would serve as distributor. The proposed ETFs would be: •The iShares Active Equity Fund. It would invest at least 80% of its assets in large-cap U.S. stocks. No specifics are given on where the remaining 20% can go, but a section of the document does describe how the fund can use American Depository Receipts, or ADRs, with foreign-based companies. While not holding to any index, the ETF's adviser will select from the 1,000 largest stocks traded on domestic exchanges. "BGFA will utilize a portfolio construction and optimization process to select stocks in the initial equity fund which incorporates proprietary investment insights," the filing stated. But here's the real interesting part: "BGFA will seek to weight the securities in a transparent quantitative manner. The weighting of the securities will be consistent with research suggesting that equal weighted approaches to stock selection may provide superior risk adjusted returns." The fund would also be permitted to invest in futures contracts, options and other derivative instruments. Those could include among others: convertible securities; floating rate securities; credit-linked notes and preferred stock. It could also make short sales "to enhance returns as part of an overall investment strategy or to offset a potential decline in the value of other holdings," the filing added. Full Story:
ETF BASIC NEWS May 13, 2009 6:35pm

Concerns UNG ETF gas fund driving price may be overblown

naturalgas1NEW YORK, May 13 (Reuters) - Recent concerns that growth in the United States Natural Gas Fund (UNG.P) (UNG) has been the primary driver behind the strong gas price run-up this month may be overblown, some industry analysts said. Some analysts have estimated UNG could hold as much as 80 percent of New York Mercantile Exchange June natural gas open interest, stirring concerns that such a huge share could impact price volatility. But some said the share was probably a lot lower. "There's been a lot of attention paid to the growing open interest held by UNG, but it's completely disingenuous to say that it currently represents 80 percent of the futures market. That completely overstates the case," said Addison Armstrong, director of market research at Tradition Energy in Connecticut. Armstrong noted that data from May 12 showed UNG held the June futures equivalent of about 42,000 contracts, or only about a quarter of the NYMEX June gas open interest, which includes both swaps and futures contracts. UNG is an exchange-traded fund, or ETF, that tracks the price of natural gas futures on the New York Mercantile Exchange. It's one way for smaller players to invest in commodities like gas by buying shares in the fund without worrying about margin calls if their bet goes wrong. Full Story:
NYSE:UNG May 13, 2009 6:24pm

Stocks Downshift After Steep Run Higher; FAZ up 14%

ouchStocks tumbled, led lower by the Nasdaq, which fell -3.0%, or -52 points, to 1,664. The Dow dipped -184 points to 8,285, while the S&P dropped -24 points to 884. Oil slipped -83 cents to $57.88 a barrel, while gold climbed $2.00 to $925.90 an ounce. Topping the economic headlines, the Commerce Department announced that total retail sales dipped -0.4% in April, and -0.5% excluding autos. Economists were looking for April retail sales to be flat and up 2.0% excluding autos. The Leveraged ETFs Index was the top performing tickerspy Index on the day, led by Direxion Daily Financial Bear 3x Shares (NYSE: FAZ - News) with a 14% gain. Full Story:
NYSE:FAZ May 13, 2009 5:24pm

Going Beyond Big Oil to Profit from the Rise in Crude: XOM, AGU, POT, USO

gas(La Jolla CA)  With the price of petroleum hitting a six month high, stocks and sectors other than Big Oil are also prospering.  There are other benefits to owning shares in these companies or ETFs, as they are not as exposed as an Exxon (NYSE: XOM ) or a British Petroleum (NYSE: BP) to the fluctuations in the price of crude.  These stocks and sectors bring diversity and downside protection to a portfolio while still gaining when the cost of oil increases. Canadian energy income trusts offer investors high yields, a currency hedge and a play on the price of oil.  Penn West Energy Trust  (NYSE: PWE), Baytex Energy Trust  (NYSE: BTE),  Pengrowth Energy Trust (NYSE: PGH) and Enerplus Resources Fund (NYSE: ERF) have to pay out earnings to shareholders.  As a result, yields are often double digit: Penn West at 12.33% and Pengrowth Energy Trust at 12.96%, for example. As the price of oil climbs, so do the share prices.  Canadian Energy Trusts also increase in value when the Canadian dollar is stronger against the US dollar.  With the economic outlook indicating an increase in the price of oil along with a decline in the US dollar, Canadian energy trusts offer an upside potential on several fronts.  Fertilizer stocks such as Agrium (NYSE: AGU), Potash (NYSE: POT) rise with the price of oil, as petroleum is used in production.  Over the past 18 months, these stocks have outperformed the main oil ETF (NYSE: USO). Full Story:
NYSE:USO May 13, 2009 12:03pm

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