Posts filed under “ETFs”

A quick look at ETFs

The Financial Times – Look to history for profitable stockpicking
The growth, proliferation and popularity of exchange traded funds has had consequences not all of which are beneficial. Today investors need no longer discern and analyse the differences between Exxon and Chevron since the Energy Select Sector ETF provides an opportunity to own both. And while the Technology Select Sector ETF, the short-cut to own S&P tech stocks, gives you both Apple and Google, you also end up with some MasterCard stock. As might be expected, this has created more interest in group, sector and top-down approaches… One of the difficulties in analysing historical sector performance has been the lack of data. For one, the S&P had approximately 100 groups, 20 of which might have been considered consumer-orientated. In 2001 S&P introduced 10 economic sectors, which made analysis somewhat easier but their data were only backdated to 1989. My firm subsequently took the data back to 1962 and then beyond.

Source: Bianco Research

Category: ETFs, Think Tank

ETF Assets

Click to enlarge: The Financial Times – ETF glow fades for US investors A record number of new US exchange traded funds failed to attract substantial investor demand last year, leaving fund operators facing losses in one of the first signs that the industry’s explosive growth may have peaked. ETFs allow investors to trade baskets…Read More

Category: ETFs, Think Tank

The Story of ETF Creation and Redemption

Ever wonder what allows ETFs to be liquid? The answer is “creation and redemption,” the process that lets ETFs trade even when volume is low. Using simple illustrations and a metaphor about flowers, this seven-minute animation will change the way you look at ETFs.

Hat tip Themis Trading

Category: ETFs, Video

Diverging ETFs: What Are GLD & SPY Telling Us ?

GLD vs. SPY Relative Price click for larger graphic Source: Solari Report, Yahoo Finance > Here is an interesting observation: The value of the SPDR Gold Trust (GLD) is now worth more than the SPDR S&P 500 (SPY) representing the full index. (This refers to the ETFs and not the underlying value of the SPX…Read More

Category: Contrary Indicators, ETFs, Gold & Precious Metals, Psychology, Trading, Valuation

S&P500 Cap Weight versus Equal Weight

The S&P500 is one of the most widely held indices in the US. And yet, the Market Cap weighted version has a tendency to become dominated by a handful of big caps. This is especially likely towards the end of a major run, when a handful of megacaps dominate the trading action. One possible solution?…Read More

Category: ETFs, Markets

The Other Side of Active ETFs: Follow the Money

Ari Weinberg is the WSJ Editor for Financial Tools; His perspective can also be seen on occasion at the Journal’s MarketBeat. ~~~ PIMCO made a big splash in the small world of actively-managed exchange-traded funds by filing for an ETF version of its Total Return Fund. As many have accurately noted, PIMCO’s filing makes a…Read More

Category: ETFs, Investing, Think Tank

Barron’s: Buy Japan Now

Interesting cover on Barron’s this week: This is hardly a contrary view — I’ve heard from lots of people saying they are doing the same thing. As mentioned previously, stick with the small cap funds (DFJ, SCJ, and JSC). The large market cap ETF (EWJ) is not the ideal investment for the bounce back (already…Read More

Category: ETFs, Financial Press, Investing

Trading Japan’s EWJ

click for larger chart Chart courtesy of FusionIQ, Bloomberg > I wanted to follow up a post from last year about EWJ. Back in December ’10, I mentioned 10 Reasons I Am Thinking About Japan. Regardless of your views going forward, if you owned or traded this, you should have had a plan in place,…Read More

Category: Apprenticed Investor, ETFs, Trading

And in ETF News

NEW YORK (Big Picture Exclusive) – Gargantuan money manager Blackrock reported on Friday that assets in U.S.-listed exchange-traded funds and exchange-traded products have surpassed the $1 trillion milestone for the first time.  Combined assets in U.S.-listed ETFs and ETPs reached $1.027 trillion late Thursday, BlackRock said. That includes 894 ETFs with assets of $887.2 billion…Read More

Category: ETFs, Markets

The Strange and Interesting History of the GLD ETF

I first recommended GLD on Power lunch back in 2005. The Gold ETF was under $50, and the rec was greeted with widespread skepticism. The basis for the call was the 1% rate level that had set off a spiral of inflation in everything priced in US dollars or credit. But I had no idea…Read More

Category: ETFs, Gold & Precious Metals