Is Spain The New Greece?

by on May 26, 2012 | ETFs Mentioned:

A wild week on Wall Street came to a sour end on Friday, as reduced activity ahead of a long weekend saw stocks trade lower as the final bell approached amidst ongoing anxiety. Volatility seemed to have temporarily subsided, though a VIX north of 21 indicates that there is plenty of lingering anxiety among investors. Attention has generally turned to Spain, where financial giant Bankia is appealing to the government for what could be the largest bailout in the history of the country. Along with lingering concerns about Greece’s future in the euro zone, these developments helped to send European stocks lower and continue to cast a cloud over the region [see also 101 ETF Lessons Every Investor Should Learn].

Actionable ETF Trade Ideas

Last Week’s Actionable ETF Ideas
Ticker Position Performance
SPLV

Long

+1.3%
PCY

Long

-0.1%
USO

Long

-0.6%

Our picks from Monday’s Insider posted relatively strong performances during an otherwise dismal trading week on Wall Street. Below, we highlight how our trade ideas fared during the week [sign up for a free trial of ETFdb Pro to get actionable ETF ideas every Monday, as well as access to more than 40 all-ETF model portfolios].

Trade #1 Long SPLV: Up 1.3%

SPLV has been impressive during the recent chaos, as shown by the performance last week. While broad-based indexes were generally down, low volatility stocks fared well.

Trade #2 Long PCY: Down 0.1%

PCY moved generally sideways throughout the week, as the insulation from currency exposure generally worked out well for investors. As the dollar strengthened against risky currencies, ETFs that hold local currency debt generally sunk. PCY continues to offer an attractive yield opportunity.

Trade #3 Long USO: Down 0.6% 

After surging Monday morning, oil prices pulled back a bit throughout the week and crude closed below $90 at one point. Still, USO performed relatively well and could be worth watching as the summer driving season approaches.

ETFdb Portfolios

Retirement ETFdb Portfolios

Our plain vanilla retirement portfolios have been generally lower lately after some declines in stock markets. Still, all are comfortably in positive territory in terms of YTD returns:

ETFdb Portfolio 1 Week 4 Week 13 Week YTD 1 Year 3 Year 5 Year
Ready To Retire ETFdb Portfolio -0.28% -1.74% -0.88% 3.09% 4.36% 39.16% 22.04%
5 Years Til Retirement Portfolio -0.44% -2.93% -2.17% 3.15% 1.60% n/a n/a
10 Years Til Retirement Portfolio -0.51% -4.06% -3.47% 3.33% -0.30% 45.25% 7.01%
Moderate Portfolio -0.57% -3.74% -3.41% 2.83% 0.05% n/a n/a
20 Years Til Retirement Portfolio -0.74% -5.19% -4.34% 4.14% -1.75% 52.23% n/a
30 Years Til Retirement Portfolio -0.80% -5.66% -5.15% 3.89% -3.03% 56.07% n/a
Cheapskate Portfolio -0.82% -4.56% -4.33% 2.14% -2.53% n/a n/a
Aggressive Portfolio -1.05% -6.65% -7.28% 2.14% -6.66% n/a n/a
Low Volatility Portfolio -1.32% -2.71% -0.97% 1.21% n/a n/a n/a

Regional ETFdb Portfolios[see All Portfolio Returns].

Not surprisingly, model portfolios with big allocations to risky asset classes fell sharply over the last week. Emerging markets were hit particularly hard, with BRICs posting meaningful losses. Africa was an interesting bright spot, as the portfolio focusing on these markets held up relatively well.

ETFdb Portfolio 1 Week 4 Week 13 Week YTD 1 Year 3 Year 5 Year
Africa-Centric Portfolio -0.04% -5.71% -5.49% 6.74% -9.31% n/a n/a
Ex-Europe ETFdb Portfolio -0.52% -4.21% -3.85% 2.77% -0.92% 39.69% n/a
Ex-U.S. Portfolio -0.64% -7.39% -8.88% 0.83% -12.05% 21.75% n/a
Asia-Centric ETFdb Portfolio -1.14% -7.30% -10.08% 1.01% -11.38% n/a n/a
Euro Free Europe Portfolio -1.30% -9.70% -11.30% -1.89% -17.06% n/a n/a
Global Titans ETFdb Portfolio -1.48% -5.42% -5.57% 2.67% n/a n/a n/a
Emerging & Frontier Markets ETFdb Portfolio -1.50% -7.28% -8.66% 3.10% -9.96% n/a n/a
LatAm Centric ETFdb Portfolio -1.85% -10.49% -15.15% -2.56% -17.35% n/a n/a
BRIC-or-Bust ETFdb Portfolio -2.40% -10.52% -16.11% -2.27% -22.73% n/a n/a
Easy-As-ABC ETFdb Portfolio -2.57% -10.69% -13.17% -2.76% n/a n/a n/a

Themed ETFdb Portfolios

Our gold-centric ETFdb portfolio has performed quite well recently, riding a surge in gold miner stock prices higher. This portfolio, however, is still well into negative territory over the last year, as mining stocks have generally declined.

ETFdb Portfolio 1 Week 4 Week 13 Week YTD 1 Year 3 Year 5 Year
GLD-Free Gold Bug ETFdb Portfolio 4.97% -7.42% -19.35% -7.64% -13.09% n/a n/a
Black Swan Hyperinflation Portfolio 1.39% -6.34% -11.95% -3.24% -10.43% n/a n/a
The Sky Is Falling Portfolio -0.06% -0.22% -5.29% -3.58% -0.21% n/a n/a
Better-Than-AGG Total Bond Market ETFdb Portfolio -0.29% -0.54% -0.70% 1.53% n/a n/a n/a
Futures Free Commodity ETFdb Portfolio -0.34% -9.09% -12.89% -2.96% -22.59% n/a n/a
Simple (But Effective) Safe Haven ETFdb Portfolio -0.35% -3.59% -4.44% -0.37% -0.63% 45.82% n/a
Energy Bull ETFdb Portfolio -0.53% -8.64% -14.09% -5.96% n/a n/a n/a
High-Tax Bracket ETF Portfolio -0.56% -3.80% -4.24% 4.45% -1.19% 38.02% n/a
Cheapskate Hedge Fund ETFdb Portfolio  -0.64% -1.64% -2.90% -2.06% n/a n/a n/a
Financials Free ETFdb Portfolio -0.67% -4.08% -4.72% -1.06% -2.32% 43.34% n/a
High Yield ETFdb Portfolio -0.67% -3.53% -3.05% 2.25% 3.04% 54.44% n/a
Actively-Managed ETF Portfolio -0.94% -2.73% 0.31% 5.13% n/a n/a n/a
Alpha Seeker Portfolio 2.0 -0.98% -4.11% -2.46% 3.17% -3.79% n/a n/a
2012 ETFdb Portfolio -1.06% -7.38% -8.10% 1.93% n/a n/a n/a
Small Cap ETFdb Portfolio -1.10% -5.56% -6.05% 3.96% n/a n/a n/a
King Dollar ETFdb Portfolio -1.13% -3.26% -3.43% 0.45% n/a n/a n/a
Socially Responsible ETFdb Portfolio  -1.13% -4.68% -4.68% 1.58% -2.57% n/a n/a
Kitchen Sink ETFdb Portfolio -1.14% -5.12% -5.68% 1.58% n/a n/a n/a
Commodity Guru ETFdb Portfolio -1.18% -7.52% -10.18% -1.23% -12.86% n/a n/a
Ben Graham 50/50 Portfolio -1.26% -3.33% -3.50% 1.41% n/a n/a n/a
Pure Growth ETFdb Portfolio -1.40% -5.68% n/a n/a n/a n/a n/a
RAFI ETFdb Portfolio -1.40% -8.75% -10.70% -0.47% -12.93% 41.07% n/a
AlphaDEX ETFdb Portfolio -1.54% -6.91% -8.01% 0.16% n/a n/a n/a
Equal Weight ETFdb Portfolio -1.65% -4.44% -6.15% 0.96% -3.65% n/a n/a
Baby Boomers ETFdb Portfolio -1.74% -5.08% -2.46% 4.51% -0.84% n/a n/a
High Tech ETFdb Portfolio -1.87% -6.87% -7.26% 5.28% n/a n/a n/a
Pure Value ETFdb Portfolio -2.52% -7.11% n/a n/a n/a n/a n/a
Greedy When Others Are Fearful ETFdb Portfolio -2.70% -6.06% -6.82% 2.15% n/a n/a n/a

New ETF Highlights

The exchange-traded universe continues to evolve as several issuers filed plans with the SEC for new products and several new fund hit the street this past week. Check out our ETF Launch Center for complete updates on all new ETFs.

ETF Launches

USD Covered Bond (COBO)

  • Launch: May 23rd
  • ETFdb Category: Corporate Bonds
  • Structure: ETF
  • Expense Ratio: 0.35%

ProShares brought to market the very first covered bond ETF, giving investors access to corporate bonds that are generally AAA-rated. Covered bonds utilize a pool of high quality securities to effectively provide additional safety to investors.

ETRACS Monthly Pay 2x Leveraged Dow Jones Select Dividend Index ETN (DVYL)

  • Launch: May 23rd
  • ETFdb Category: Large Cap Value Equities
  • Structure: ETN
  • Expense Ratio: 0.35%

This ETN offers 2x monthly leveraged exposure to the same index that the popular DVY seeks to replicate. For investors seeking high yield, this note could be worth a closer look.

ETRACS Monthly Pay 2xLeveraged S&P Dividend ETN (SDYL)

  • Launch: May 23rd
  • ETFdb Category: Large Cap Value Equities
  • Structure: ETN
  • Expense Ratio: 0.30%

This ETN is similar to DVYL, but linked to a different index of dividend-paying stocks. SDYL effectively offers 2x monthly leveraged exposure to SDY, a popular ETF that holds companies with attractive yields.

Global Echo ETF (GIVE)

  • Launch: May 24th
  • ETFdb Category: Diversified Portfolio
  • Structure: ETF
  • Expense Ratio: 1.70%

This active ETF is premised on the idea of sustainable investing, and utilizes multiple managers across a number of different asset classes.

Disclosure: No positions at time of writing.