In recent weeks, the future of the euro has been a hot topic among investors, as the current “stress testing” of the common currency system has uncovered some worrisome flaws. The euro has slumped against many of its major rivals as fears about escalating budget crises in Greece, Spain, and Italy have caused investor anxiety. But for all the focus on the euro’s struggles, most investors do not realize so far in 2010 British pound ETFs have lost more ground than euro ETFs. The CurrencyShares British Pound Trust (FXB) is down 6.7% year-to-date, compared to a loss of 5.6% for the CurrencyShares Euro Trust (FXE). This sharp downturn in the pound comes as Britain finds itself in the worst fiscal situation since World War II. Some estimates put the current UK budget deficit at roughly 12.7%, on par with Greece. On the heels of Greece’s budget woes, this news comes much to the dismay of continental Europe, which is growing increasingly concerned over the fiscal condition in the British Isles. Recently the EU called on Britain to introduce immediate measures to prevent the shortfall from worsening in the next financial year. [click to continue…]
As global economies grapple with the challenge of unwinding massive stimulus plans in an orderly manner, central bank meetings have taken on a new importance. Following a relatively uneventful meeting of the Federal Reserve, Brazil’s central bank took center stage this week, deciding to keep rates steady at a record low of 8.75%. Some investors were surprised by the move since inflation, recently recorded at 4.83%, has surged above the Bank’s target of 4.5%. The news had an interesting effect on Brazilian markets; the iShares MSCI Brazil Index Fund (EWZ) lost close to 1.5% and the WisdomTree Dreyfus Brazilian Real Fund (BZF) dropped more than 0.9%. [click to continue…]
With just two and a half months in the books, 2010 has already been an odd year from an investment perspective. A small European nation that accounts for just a fraction of global GDP has become a major driver of stock and bond markets around the globe, capable of setting off both buying and selling [...]
Federal Reserve meetings are always among the most anticipated and closely scrutinized events in the investment community, as specific decisions on key interest rates and more general observations on the state of the economy have the power to set off waves of either buying or selling on Wall Street and around the globe. Central bank [...]
As job loses continue to mount in the United States–first-time claims for unemployment insurance recently rose by 22,000 to a seasonally adjusted 496,000–many political officials and ordinary citizens are looking for creative ways to stem the seemingly never-ending loss of jobs. One of the hottest issues in recent weeks has been China’s currency policy, which [...]
As seasoned investors know, any potential investment must be evaluated not on a stand-alone basis but on its contribution to an overall portfolio. In addition to considering the risk and return profile of a particular asset, the relationship between that asset and the other holdings of the investor is of vital importance in the construction [...]
Last Friday, the U.S. Labor Department reported that the consumer price index (CPI) rose 0.2% in January and climbed by 2.6% over the past 12 months. But after stripping out volatile food and energy prices, prices actually fell by 0.1% in January, marking the first time since 1982 that “core CPI” has declined. While the [...]
For investors in the process of rebalancing their portfolio or taking a step back from the stock and bond markets, money market accounts have historically provided an opportunity to generate returns over the short run while maintaining the flexibility to redeploy assets at any time. During periods of sustained economic growth and bull market rallies, [...]
One of the major stories of 2010 has been turmoil in the euro zone, as crumbling public finances in Greece have stoked fears of a “contagion effect” sweeping throughout the region. The prolonged economic downturn has left Greece with a massive budget deficit, and with $28 billion in debt due in April and May, fears [...]
WisdomTree, the ETF issuer specializing in dividend and earnings weighted funds, announced a change to the Japan Total Dividend Fund (DXJ) beginning April 1. DXJ will still follow the same equities and maintain an expense ratio of 0.48% but will also seek to neutralize the affects of the volatile currency market and limit the impact [...]
In a generally strong global economic recovery, Japan has been one of the weakest links, struggling to gain any sort of traction while battling deflation and ineffective policies from a government elected with hope for great changes. An already tough road back to sustainable economic growth got even tougher on Tuesday when Standard & Poor’s [...]
Michael Johnston, senior analyst at ETF Database, appeared on live television this morning to discuss a few ETFs that would serve as possible hedges against inflation, including:
WisdomTree Dreyfus Emerging Currency Fund (CEW)
IndexIQ CPI Inflation Hedged ETF (CPI)
Claymore/Clear Global Timber Fund (CUT)
Market Vectors TR Gold Miners Fund (GDX)
IndexIQ ARB Global Resources ETF (GRES)
Watch the full interview [...]
