ETF To Profit As Eurozone Repeats 2009 Financial Crisis [Vanguard FTSE Europe ETF, iShares S&P Europe 350 Index (ETF)]

Greece—one of the early victims of the debt problems in the eurozone—hasn’t really shown much improvement. According to an analysis by Pricewaterhouse Coopers, the percentage of bad loans compared to all loans in the Greek economy will increase to 40% this year. The Bank of Greece, at the end of June, said loans that were overdue by three months made up 29.3% of all loans. (Source: “Bad Loans Overwhelm Greek Banks,” Greek Reporter, January 22, 2014.)

Looking at all this, one must ask if there’s another financial crisis waiting to happen in the eurozone. Time will draw a better picture, but all of these problems arising in the eurozone are creating an investment opportunity for investors here in the U.S. Take a look at the chart below.

iShares MSCI Europe Financial Sector Nasdaq GM Chart

Chart courtesy of

The chart above shows the price action in iShares MSCI Europe Financials (NASDAQ:EUFN), an exchange-traded fund (ETF) that tracks the performance of the banking sector in Europe. Since mid-January, this ETF has been declining. Recently, it posted its biggest volume since its inception on the day when prices declined. It’s an indicator that investors are selling in weakness.

If the momentum in this ETF continues to the downside, investors here in the U.S. may be able to profit by shorting it.

This article is brought to you courtesy of Moe Zulfiqar from the Daily Gains Letter.

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