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For ETF Investors, The Details Matter (Part II)

Michael Johnston — Mon, 17 Jan 2011 15:00:02 +0000

Last week we highlighted several often-overlooked nuances of popular exchange-traded products, detailing the surprisingly large impact that seemingly minor distinctions can have on a portfolio’s risk/return profile. From the weighting methodology employed by the underlying index to the choice between large caps and small caps for international equity exposure, many details that are often the subject of little consideration can play a big role in determining how an ETF portfolio performs. Below, we highlight five more easy-to-overlook nuances of ETF investing that are often felt in the bottom line [for more ETF insights, sign up for our free ETF newsletter]: 1. Futures-Based vs. Physically-Backed The introduction of commodity ETFs in recent years serves as an example of the impressive innovation that has become common in the ETF industry. Previously, exposure to natural resource prices was hard to come by for many investors. But the proliferation of exchange-traded commodity products has [...]

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What’s In A Name: A Look Inside ETF Tickers

Michael Johnston — Wed, 03 Feb 2010 14:42:04 +0000

Whenever a company prepares for a public offering, executives have been known to spend an inordinate amount of time choosing the combination of letters that will serve as the company’s ticker and often nickname within the investment community. To many, the fixation on selecting the perfect ticker seems like an irrational obsession on par with Patrick Bateman’s affinity for business cards. But there’s some evidence to support the idea that picking a clever ticker can be worth quite a bit of money. An academic study titled “Would A Stock By Any Other Ticker Smell As Sweet?” (PDF) examined the performance of “clever ticker” stocks such as Southwest (LUV), Internet America (GEEK), Lion Country Safari (GRRR), and Explosive Fabricators (BOOM). This study uncovered that between 1984 and 2004, “a portfolio of clever-ticker stocks would have beaten the market by a substantial and statistically significant margin, contradicting the efficient market hypothesis.” Theories [...]

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Definitive Guide to BRIC ETFs: BRIC ETF Investing 101

Eric Dutram — Wed, 28 Oct 2009 12:00:18 +0000

With sluggish growth forecasted for the next few quarters an unemployment rate quickly approaching 10%, many U.S. investors are looking beyond their borders for new investment opportunities. While developed European and Asia Pacific economies have received a significant amount of attention, the most popular investment destinations remain the four largest emerging market countries: Brazil, Russia, India, and China, collectively known as the “BRIC” economies. Together, these four countries currently comprise 40% of the world’s population and 15% of GDP, ensuring that they will be a force to be reckoned with on the global stage for years to come. Meanwhile, combined foreign reserves total over $3.1 trillion, potentially allowing these countries to influence world trade and push politics more towards a multipolar world. Historically, it has difficult for many American investors to access BRIC equity markets directly; most have relied primarily on the few stocks that trade as American Depository Receipts [...]

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Edward Jones Discontinues Sale Of Leveraged ETFs

Michael Johnston — Wed, 22 Jul 2009 14:38:26 +0000

The swelling controversy over the risks associated with leveraged ETFs has apparently caused its first casualty. St. Louis-based Edward Jones & Co., the prominent financial services firm, decided during a regular review of its products in June to stop selling leveraged funds, citing the fact that they are “one of the most misunderstood and potentially dangerous types of ETFs,” according to mutual fund research analyst Katie Martin. Edward Jones prepared a report titled “Not All ETFs Are Created Equal” that highlights the potential pitfalls with these complex financial instruments. “Investors also need to recognize that leveraged ETFs have an increased potential for capital gains distributions and significantly higher expense ratios than the traditionally broadly based stock market ETFs, negating some of the benefits of purchasing an ETF,” the report said. Edward Jones’ decision to drop the product line comes as calls for regulation of leveraged ETFs are reaching a fever pitch. [...]

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ProShares Launches Four New Leveraged International ETFs

Michael Johnston — Thu, 04 Jun 2009 15:31:34 +0000

ProShares, a leader in the inverse and leveraged ETFs, today launched four new ETFs offering magnified exposure to international markets. The funds, which seek 200% of the daily returns of their target indexes, are: Ultra MSCI EAFE (EFO) Ultra MSCI Emerging Markets (EET) Ultra FTSE/Xinhua China 25 (XPP) Ultra MSCI Japan (EZJ) Commenting on the new funds, ProFunds Chairman and CEO Michael L. Sapir said, “With some international markets posting strong year-to-date returns, investors are expressing interest in tools that allow them to gain magnified exposure to these markets. These new ETFs complement our existing ETFs that are designed to provide short (or inverse) exposure to the same international indexes. Over the coming weeks, we plan to further expand our international offerings with ETFs covering more regions and specific countries.” According to ProShares web site, the sponsor is targeting the future launch of “four new UltraShort ProShares for European, Pacific, and [...]

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ETF Database » EET

For ETF Investors, The Details Matter (Part II)

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What’s In A Name: A Look Inside ETF Tickers

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Definitive Guide to BRIC ETFs: BRIC ETF Investing 101

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Edward Jones Discontinues Sale Of Leveraged ETFs

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ProShares Launches Four New Leveraged International ETFs

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