This Week In ETFs: July 22nd Edition

by on July 22, 2012

U.S. equities took a roller coaster ride this week, starting off strong, but eventually ending up in red territory at the close of Friday’s trading session. For the most part, better-than-expected corporate earnings seemed to outshine the slew of sour economic data, as several bellwether stocks beat analysts’ forecasts with relatively strong reports. Fed Chairman Ben Bernanke also made the headlines with his testimony to congress on Tuesday and Wednesday. Investors were somewhat disappointed, as Bernanke gave no hints of the central bank taking further action to help boost the economy. Markets, however, seemingly ignored the chairman’s dour outlook and solidified their beliefs that eventually the Fed will be forced to step in. Although U.S. equities had a strong start off to the week, they plummeted on Fridayas new concerns emerged about the possibility of Spain being forced into a full-fledged sovereign bailout [see also 7 Simple & Cheap ETF Model Portfolio].

The ETF industry had a relatively active week on the product development front. Six new funds were introduced to the markets, including a pair of leveraged Australian dollar ETFs from ProShares and a new UBS ETN that tracks the Alerian MLP Index [see also The One Chart Every Commodity Trader Must See].

Below we outline the three best stories from around ETF space this past week:

1. Should You Trust Your ETF? at IndexUniverse:

Corruption, collusion and greed – all terms that have been used synonymously with some of the most notorious manipulators on Wall Street. With the infamous LIBOR scandal coming to the forefront again, many investors are wondering if they have fallen victim once more to corrupted markets. As the evidence continues to be revealed, investors and traders alike want to know if their investments are safe. In this article, author Paul Britt tries to answer the question “should you trust your ETF?” and highlights which ETFs rely most heavily on trust.

 2. Corn Prices Hit All-Time High; Time To Harvest Profits In ETFs? at The Wall Street Journal:

Temperatures have been rising to dangerous levels across the United States, sending a devastating heatwave across some of the most crucial farming lands. The Corn Belt, an area in the Mid-Western United States, has been hit the hardest this summer, as severe droughts have destroyed a significant portion of this year’s corn crop, sending corn prices to record highs. But as with all agricultural products, investors can try to cash in on disruptions in supply levels. In this article, author Chris Dietrich outlines which ETFs have been most affected by the heat waves of summer 2012.

 3. Poland ETFs: A Bright Spot In A Gloomy Region at ETF Database:

With the eurozone in shambles, it is not surprising to see allocations to this part of the economy diminish over the years. Investors remain wary of having significant exposure to some of the troubled countries, as the region’s financial health has only gotten worse in the past two years. Despite the rather grim outlook, there is one country that has proved to be a bright spot in the gloomy region: Poland, a country who has shown resilience amidst global market turmoil. This article, by Stoyan Bojinov, highlights Poland’s luster and outlines how investors can use ETFs to gain access to the potentially lucrative nation.

Disclosure: No positions at time of writing.