This Week In ETFs: October 2nd Edition

by on October 2, 2010

September brought investors a long awaited rally in the markets and bucked the trend in what is generally one of the weakest months of the year for equities. This year, the month produced robust gains which have not been seen in a September since since 1939. October then came in with most markets in the green, furthering September’s rally and boosting hopes that our economy may finally be headed to stability. Yet again, gold struck record highs this past week as it broke the 1,300 mark and then continued its march higher, leaving many to wonder if this is just a temporary gain, or if these prices are here to stay. The ETF world was busy as well with several new funds hitting the market, giving investors even more options in today’s uncertain economic environment [see more at September ETF Roundup: Launches, Filings, and Closures]. Below, we highlight three of the best ETF stories from around the Web during the last week:

ETF Poppycock at Index Universe:

Since the flash crash in early May, ETFs have been under fire from wild accusations that have turned these formidable investing tools into an investor’s potential nightmare. Some have blamed the ETF industry for rising asset correlations, higher commodity prices, and for using short selling methods that could possibly cause a fund to collapse entirely leaving investors in the lurch. In this piece, Dave Nadiq debunks many of these outrageous claims as he provides thorough evidence for why ETFs are victims of a smear campaign, rather than perpetrators of all sorts of economic troubles.

Three ETFs To Play Global Water Scarcity at ETF Daily News:

Its no secret that the world’s population is experiencing exponential growth, and along with that growth will come higher demand for the everyday necessities. As populations expand, the demand for life’s most valuable commodity, water, is set to skyrocket. With the global demand for water set to grow 6% annually for the foreseeable future, now may be a good time to invest in some of the funds that track water resources firms. This article outlines several ETF options for investors looking to allocate to this growing and important industry.

Five Facts Every Investor Should Know About Leveraged ETFs at ETF Database:

With plenty of controversy surrounding the leveraged/inverse ETF space, this article aims to inform investors on what they should know about these often misrepresented funds. Michael Johnston outlines five important factors that investors should take into consideration when looking at this investment class including; the different types of leveraged funds, their compounding methods, and a detailed look at how they achieve their exposure.

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Disclosure: No positions at time of writing.