Jan. 16, 2008 - It’s been ugly for stocks over the last month. Let the ETF data do the talking:
Archive for the ‘ETFs’ Category
Byron Wien’s ‘5 Sure Things’
Tuesday, January 29th, 2008
Jan. 29, 2008 - This is irresistible. During periods where there seems to be such confusion in the market, we could certainly all use a dose of clarity.
Byron Wien, Chief Global Strategist, Pequot Capital, and one of a few prolific market forecasters, shares his 5 ‘Sure Things’ for this turbulent market:
I’m getting older now, so I only invest in sure things. I don’t invest in things that only “might” work out. So let me give you five sure things.
Prior to his current position as Chief Investment Strategist at Pequot Capital, Byron Wien was Chief Global Strategist at Morgan Stanley.
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Tags: Agriculture, Canadian Stocks, Commodities, Currency, Economy, Emerging Markets, energy, Gold, India, Investment Strategy, Investment Wisdom, Russia, US Stocks
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Short ETFs - Portfolio insurance
Tuesday, January 29th, 2008
Jan. 29, 2008 - Short and UltraShort Funds provide investors with highly liquid inverse exposure to the markets as represented by widely held benchmark indices.
Check out these charts for a couple of good examples. Most investors have difficulty grasping the idea of taking ’short’ positions or bets against the very markets that they are investing in. These new ’short’ ETFs do not require a great deal of sophistication or a margin account for the average investor to get some portfolio insurance.
iShares FTSE Xinhua 25 (FXI) vs. ProShares UltraShort FTSE Xinhua 25 (FXP)
iShares MSCI Emerging Markets (EEM) vs. ProShares Short MSCI Emerging Markets (EUM)
ProShares Ultra Financials vs. Proshares UltraShort Financials (Dow Jones Financial Index(sm))
If you believe that there is more downside to come, then its still not too late to get some downside protection.
Don Coxe, in his recommendations from Basic Points, January 2008, warns:
The financial crisis is not centered in stock markets. Its primary locus is in financial derivatives, and in their impact on the stock prices of leading banks. Until the downward drift of bank stocks and the upward drift of derivative debt yields are reversed, the stock market will continue to slide. Keep overall equity exposure to minimums, and emphasize quality.
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Tags: Investment Strategy, Technical Analysis
Posted in EEM, ETFs, EUM, FXI, FXP | No Comments »
Recent ETF Performance
Wednesday, January 16th, 2008
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Tags: Miscellaneous
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Dennis Gartman: Selling half of his gold position
Saturday, January 12th, 2008
January-12-08, 10:48:59 AM | GreenLight Advisor
Dennis Gartman is selling half of his gold position. His argument is that gold has reached an interim top citing a ‘perfect storm’ of media fanfare, rising Democratic Party leftism, Countrywide’s failure, and deteriorating economics fundamentals, and while he feels that gold will likely be at higher prices next year, it will retrace to around $800 before turning up again. He holds a position in GLD.
Wed. Jan. 9 2008 | 7:35 AM[04:58] Copyright CNBC 2008
Insight on gold’s record, with Dennis Gartman, The Gartman Letter founder and CNBC’s Becky Quick
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Tags: Commodities, Currency, Gold, Miscellaneous, Technical Analysis
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Agricultural Commodities - still in the early stages
Saturday, January 12th, 2008
You really have to hand it to Chief Strategists Don Coxe (BMO), Byron Wien (Pequot), and Jeffrey Saut (Raymond James) for accurately calling agricultural commodities higher during the last year.
Back in October, in his investment letter, Jeffrey Saut called for continued strength in the agricultural commodities due to the demand from China.
Unsurprisingly, China is importing nearly 13% of all the soybeans grown in the U.S. to feed its livestock and continues to “throw” cash at its farmers in an effort to produce more meat for Chinese consumption. And that cash flow has caused the U.S. Agriculture Department to estimate that net farm incomes in this country will soar by nearly 50% this year with an attendant increase in demand for farm equipment, irrigation equipment, fertilizer, seeds, etc. Ladies and gentlemen, this theme should have long legs as 3 billion new entrants (read: people) join the world’s economy and per capita incomes rise. While some of the “easy money” for investors has already been made from our recommendations, we think there is still room for additional investment returns. Clearly, there are numerous individual agricultural stocks for participants’ consideration (see recommendations from our previous missives and/or our research correspondents), but a broader-based approach for most investors is likely the best strategy. To this point, we embrace investment vehicles like MK Vectors Agribusiness ETF (MOO), as well as other open-end and closed-end investment funds.
During the early Summer, following his sabbatical trip to India, Don Coxe also made a powerful case for agricultural commodities (Basic Points, June 07) as a result of his call for food inflation due to the 600-million strong middle-class demand from India and China, and emerging markets in general.
…What happened with meat, eggs and milk was what had happened with oil— the assumption that those billions of people in China and India don’t really matter much to us, except in terms of giving us cheap goods and services. That they could be raising our cost of living by driving up the cost of what we eat, and how we heat—that’s a bizarre idea…
…What BHP’s Chip Goodyear calls the supercycle for energy and metals has been joined by a supercycle in grains…
…So we weren’t surprised when the same savants (1) failed to predict soaring grain prices, and then, (2) blamed them on ethanol…
…We now know that when a major Midwest crop failure occurs, it will be the global food equivalent of an Al Qaeda bomb strike that shuts down Saudi Arabian oil production for months.
Coming at a time of a worldwide shortage of feed grains and wheat, it will send food infl ation to peaks not seen since 1974. The force of those shock waves would trigger food riots across the world and topple some precarious Third World governments. It will send food infl ation to peaks not seen since 1974…
From June 15, 2007 Investment Recommendations:
3. The most attractive stock group now is companies which benefi t from food price infl ation—such as meat packers and supermarkets—and those who help farmers to boost outputs, including the feed and seed companies, and the farm machinery manufacturers. The least attractive in the food sector is the ethanol producers. Being permanently short corn is being under permanent stress.
Recently quoted in Rob Carrick’s Globe article, down on the farm is where market growth is heading Don Coxe says,
“This is not a situation that has been overhyped. Quite the contrary, and it’s still in the early stages.”
Mr. Coxe said the agricultural story at its simplest level can be explained as another 600 million people, minimum, being added over the next 10 years to the list of those who have a diet something like what we in the West enjoy. Companies that help satisfy this demand for food have already benefited, and will continue to do so. “This isn’t like saying you should buy this company because they have a really hot product that is going to be a big fad for the next two or three years.”
Byron Wien called agricultural commodities higher in his 2007 predictions, back in 2006.
Rob Carrick writes:
Increases in demand for food are outpacing supply, which in turn has resulted in high levels of food inflation. A U.S. government inflation report issued last month showed that the rate of increase in food prices had more than doubled over the previous 12 months and reached a 25-year high. Wheat and soybean prices rose close to 80 per cent last year, and corn hit an 11-year high.
If you’re heavily invested in commodities of any kind, the question you have to ask yourself is how much more upside there is. Prices for base metals like copper and zinc have been in a down trend for the past several months as expectations of a global economic slowdown grow. Oil prices would also be affected if economic activity slackens, but there’s a geopolitical component to energy prices that makes forecasting difficult.
This brings us to agricultural commodities, which are more immune to economic cycles because of basic supply-and-demand factors like global population growth and declines in the amount of cultivated land. It’s true that agricultural stocks are like food commodity prices in that they’ve soared in the past year, but one expert in the field says retail investors should not be scared to jump in.
Carrick mentions these picks of the agriculture segment:
| Stocks | Ticker | 12-Month return |
| AG Growth Income Fund | AFN.UN-T | 144.8% |
| Agrium | AGU-T | 97.7% |
| CNH Global | CNH-N | 144.9% |
| Deere & Co. | DE-N | 97.3% |
| Monsanto | MON-N | 137.0% |
| Mosaic | MOS-N | 361.3% |
| Potash Corp. | POT-T | 163.2% |
| Saskatchewan Wheat Pool | VT-T | 49.4% |
| Terra Nitrogen | TNH-N | 399.4% |
| ETFs | Ticker | 12-Month return |
| Claymore Global Agriculture ETF | COW-T | 8.6% |
| PowerShares DB Agriculture Fund | DBA-A | 38.3% |
| Market Vectors Agribusiness ETF | MOO-A | 39.6% |
By the way, Mr. Coxe recommends being overweight, even going as far as to ”hoard” agriculture related stocks. Take another look at his recommendations in the most recent Basic Points.
Download Basic Points, December 19, 2007 - The recommendations are on pg. 34.
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Tags: Agriculture, China, Commodities, India, Metals, Miscellaneous
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Gold ETFs
Sunday, January 6th, 2008
Don Coxe recommends being overweight gold, pg 34 in the December 2007 Basic Points.
4. Remain heavily overweight gold—both stocks and the ETF. Gold is almost as good a protection against banking problems as SKF—the UltraShort Financials ETF—a security which may not be a suitable investment in some portfolios.
If you’re looking for effective exposure to gold, look into streetTracks Gold Shares (GLD). Wall Street Journal’s Jan. 5, 2008 article, provides more detail:
The biggest is the streetTracks Gold Shares ETF, sponsored by the World Gold Council, a mining-industry group. Its holdings are valued at more than $16.8 billion, more than the valuation of General Motors Corp.
Each share in GLD is backed by about 1/10 of an ounce of metal held in vaults in London by HSBC Bank USA, a unit of HSBC Holdings PLC. The streetTracks ETF issues more shares as brokers see more demand in the market, and brokers receive shares for the metal they buy and transfer to the fund.
The fund sat on about 628 metric tons of gold last month, according to the World Gold Council, more than the 600 or so metric tons in Chinese central bank reserves and 604 metric tons with the European Central Bank.
In all, the eight ETFs held 834 metric tons of gold through November, according to the World Gold Council.
For Canadians looking for Canadian dollar or US dollar denominated exposure, Millenium Bullion Fund offers open-ended funds for pure bullion play in both currencies.
You can see that the Canadian version has had quite a different kind of performance due to the strength of the C$ against the Greenback.
Both the ETFs and the funds are a way for investors to get effective exposure to the yellow metal.
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Tags: Currency, Gold, Investment Strategy, Metals, Miscellaneous
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New Ag and Oil&Gas offerings from Claymore and BetaPro
Thursday, January 3rd, 2008
Claymore and Horizons BetaPro have just expanded their Canadian ETF offerings.
The newest ETF from Claymore Investments Inc. is Claymore Global Agriculture, which began trading on the Toronto Stock Exchange on Dec. 19 under the evocative ticker symbol COW. The fund’s investment objective is to track the performance, net of expenses, of a recently created benchmark called the MFC Global Agriculture Index…
Including the new agriculture fund, Claymore now has 15 distinct investment mandates in its line-up of TSX-listed ETFs. Three additional new ETFs are to be rolled out in the new year. They include Claymore 1-5 Year Laddered Government Bond, Claymore Premium Money Market and Claymore Natural Gas Commodity…
…Meanwhile, BetaPro Management Inc., which offers ETFs that provide leveraged long or short exposure to various mainly sector indices, is planning to add 10 new funds. BetaPro has filed a preliminary prospectus for five “Bull Plus” funds and an equal number of corresponding “Bear Plus” funds. The funds will provide either leveraged positive or leveraged negative exposure to natural gas, crude oil, gold, the mining industry and the agriculture sector…
The five reference benchmarks for the 10 upcoming Horizons BetaPro funds are the next-month contracts for NYMEX light crude oil, NYMEX natural gas and COMEX gold futures; the S&P/TSX Global Mining Index, and the Dow Jones-AIG Grains Sub-Index.
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Tags: Agriculture, Canadian Stocks, Commodities, Investment Strategy, Miscellaneous
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Email Broadcast - January 2, 2008
Wednesday, January 2nd, 2008
GreenLightAdvisor.com Newsletter
Issue: Vol. 1, No. 3
January 2, 2008
In This Issue
12 Ways to Make Your Kids Financially Savvy
Crazy for China - Forbes interviews the legendary Jim Rogers
Oil: Key Players and Movement
Gold bullion - a belated Christmas gift
Don Coxe’s Investment Outlook and Recommendations for 2008
Ted Seides’ The Next Dominos: Junk Bond and Counterparty Risks
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Happy New Year!
We wish you and your family a healthy, joyful, peaceful, and prosperous 2008.
God, give us grace to accept with serenity the things that cannot be changed, courage to change the things which should be changed, and the wisdom to distinguish the one from the other.
-Reinhold Niebuhr, The Serenity Prayer (1934)
Nothing endures but change.
-Heraclitus
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12 Ways to Make Your Kids Financially Savvy
By JONATHAN CLEMENTS - Wall Street Journal
December 17, 2007; Page R1
…I am not claiming to have the road map for every parent. We all have different values, different incomes and strong ideas about how best to raise children — and you will likely scoff at some of the things I’ve done. With that caveat, here are a dozen ways I have endeavored to help my kids financially….[Here are a few of the headings]
1. Waiting until later
2. Asking themselves
3. Talking the talk
4. Scoffing at wealth
Complete Story
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Crazy For China
Michael Maiello, Forbes Magazine, 12.13.07, 1:05 PM ET
An interview with Jim Rogers author of A Bull in China: Investing Profitably in the World’s Greatest Market ($27, Random House, 2007).
With George Soros, Jim Rogers is co-founder of the Quantum Fund and one of the most successful Global Macro investors in history. He tells Forbes.com why he’s so bullish on China, sour on America and will raise his family in Singapore.
Forbes.com: Are you a dollar bear or China bull?
Jim Rogers: I’m terribly pessimistic about the state of the U.S. dollar. But there are so many pessimists out there right now that we’re bound to have a rally. I doubt you can find anybody except (U.S. Treasury Secretary Hank) Paulson who is bullish on the U.S. dollars. If that rally comes, I would use that rally to sell the rest of my dollars. I’ve never seen so much pessimism in my life. So I’m a dollar bear looking for a big rally. So I can sell.
The U.S. dollar is not an asset I want to hold over the next 10, 15, 20 years. We have an idiot running the central bank right now who knows nothing about currency, history or the markets…[…]
China Markets, News, and Analysis
Complete Story
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Oil: Key Players and Movement
Courtesy of FT.com
In these times of near-$100-per-barrel oil, this interactive world map of oil’s key players and movement is very interesting…
Interactive World Map - Oil: Key Players and Movement
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…a top knotch analysis of gold bullion published by Prieur du Plessis, Plexus Asset Management, Cape Town, South Africa
Gold bullion - a belated Christmas gift
Prieur du Plessis, Plexus Asset Management, South Africa - December 27, 2007 09:25 AM CST
True to form, just as traders were bargaining on a quiet Christmas period, gold again startled with a $15 jump, taking the price well clear of the $800-level.
Interestingly, gold has never in its history recorded a month-end price above $800. It would seem that gold bulls may very well have reason to toast bullion next week, saying goodbye to 2007 having achieved the $800 month-end milestone.
Complete Story
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A Must Read…
Don Coxe’s Investment Recommendations 2008
Basic Points - December 19, 2007
In the latest issue of Basic Points, Double Double, Greed and Trouble, CDOs and the Housing Bubble, Donald Coxe wraps up the year, shares his outlook, and makes his investment recommendations for the 2008 and onwards -
1. Remain heavily underweight banks, particularly investment banks that…
2. Remain overweight Emerging Markets, emphasizing those…
3. We have been ardently endorsing India since we returned from…
4. Remain heavily overweight gold-both stocks and the ETF…
5.
Download the complete issue here
(Go to pg. 34 of the PDF for the recommendations)
The whole issue (as usual, eloquent) however, is very interesting and we urge you to read it.
Do not miss reading this one!
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This article from “John Mauldin’s Outside the Box,” features Ted Seides’ November
2007 paper highlighting counterparty and junk bond credit risks, which are starting to get a serious amount of attention now in the mainstream media.
Make sure you read it.
The Next Dominos: Junk Bond And Counterparty Risk
Monday, November 26, 2007
The subprime problem, we were told, would not spread to other markets. It would be “contained.” And it has, according to Jim Grant. He quipped last week that it has been contained on planet Earth. The risks coming from rising defaults in the US (now above 600,000 and rising from just 200,000 a few years ago) are clearly spreading to markets far beyond the subprime world.
This week’s Outside the Box talks about the next two dominoes that could fall: junk bonds and counterparty risk in the various credit default swap markets. Ted Seides is the Director of Investments at Protégé Partners, LLC, a hybrid fund of funds that invests in and seeds small, specialized hedge funds. He writes this week’s piece in Peter Bernstein’s Economic and Portfolio Strategy, one of the most respected of market analysis letters. You can learn more about the letter at www.peterlbernsteininc.com.
This piece is a little longer than most letters, but it is one of the more important editions of Outside the Box this year. This is a must read…[…]
Complete Story
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Sincerely,
The GreenLight Advisor Team
GreenLightAdvisor.com
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Tags: Canadian Stocks, China, Commodities, Emerging Markets, Fixed Income, Gold, India, Information, Metals, Miscellaneous
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