This week people on the east coast should board up their windows and place their bets on stocks that will be affected in the coming weeks by the oncoming hurricanes. While people in New York are being warned by images of the South East coast being hammered by the storm, that didn’t seem to stop anyone from coming out to the Windows 8 launch party in Times Square. Between that and the Apple iPad mini, many tech stocks are turning around after last week’s horrible earnings reports.
GDP for the third quarter was up to 2%, above economic expectations of 1.7% and above the second quarters disappointing 1.3%, but not by too much. The last presidential election debates took place earlier this week, this time concerning foreign policy. And while questions about Libya and Syria dominated the night, neither candidates were asked about the eurozone crisis, instead focusing on our massive debt to China, and what each of them would to lessen it [see Senior Bank Loans: High Yield With Perks].
iShares added to its already well-stocked portfolio four new “core” funds: IXUS, IEMG, IEFA and ISTB. These are meant to be the building blocks to a well-rounded international and domestic portfolio. Global X cut some dead weight from its portfolio with the elimination of four of its worst performing ETFs, while Russell basically exited the ETF industry, closing 25 of its 26 funds; the Russell Equity ETF (ONEF) was the only fund to escape the chopping block.
Below we outline the three best stories from around the ETF space this past week:
1. What ETFs’ Next Act Will Look Like at The Wall Street Journal:
January will be the 20th anniversary of the first ETF introduction in the U.S. markets. SPY, the SPDR S&P 500 fund paved the way for exponential industry growth, making ETFs today a necessary part of any complete portfolio. Not all of these funds have ended well; with over 300 closing to date, ETF investing looks like a fad to some in the markets. Ari Weinberg predicts which ETFs will survive more cuts, and which concepts will prove exceptional in the coming years.
2. Niche ETFs, The Next Frontier of Fear Mongering at Market Watch:
Pundits have given ETFs a lot of flack since their inception, and even more since funds have started closing left and right. The recent victims to their criticism are narrowly focused niche ETFs, which wade through the market clutter and only expose investors to exactly what they are looking for. Benzinga outlines why niche ETFs are an easy target for critics and if the pundits might be right to attack them.
3. How to Invest Overseas (Without Currency Risk) at ETF Database:
ETFs have further opened investors’ eyes to international opportunities to grow their investments, yet many have been hesitant over the last few years. Economic downturns are affecting both emerging and developed markets, and no one wants to watch their funds disintegrate overseas while invested in a foreign currency. Stoyan Bojinov spoke with Martin Kermenstein, the Director and Chief Investment Officer of Deutsche Bank Commodity Services, to discuss the importance of currency exposure in a portfolio, and how to evade fluctuations in prices.
Disclosure: No positions at time of writing.