Best of the Week
Most Popular
1. The Trump Stock Market Trap May Be Triggered - Barry_M_Ferguson
2.Why are Central Banks Buying Gold and Dumping Dollars? - Richard_Mills
3.US China War - Thucydides Trap and gold - Richard_Mills
4.Gold Price Trend Forcast to End September 2019 - Nadeem_Walayat
5.Money Saving Kids Gardening Growing Giant Sunflowers Summer Fun - Anika_Walayat
6.US Dollar Breakdown Begins, Gold Price to Bolt Higher - Jim_Willie_CB
7.INTEL (INTC) Stock Investing to Profit From AI Machine Learning Boom - Nadeem_Walayat
8.Will Google AI Kill Us? Man vs Machine Intelligence - N_Walayat
9.US Prepares for Currency War with China - Richard_Mills
10.Gold Price Epochal Breakout Will Not Be Negated by a Correction - Clive Maund
Last 7 days
Gold among Negative-Yielding Bonds - 20th Sep 19
Panicky Fed Flooding Overnight Markets with Cash - 20th Sep 19
Uber Stock Price Will Crash on November 6 - 20th Sep 19
Semiconductor Stocks Sector Market & Economic Leader - 20th Sep 19
Learning Artificial Intelligence - What is a Neural Network? - 20th Sep 19
Precious Metals Setting Up Another Momentum Base/Bottom - 20th Sep 19
Small Marketing Budget? No Problem! - 20th Sep 19
The Many Forex Trading Opportunities the Fed Day Has Dealt Us - 19th Sep 19
Fed Cuts Interest Rates and Gold Drops. Again - 19th Sep 19
Silver Still Cheap Relative to Gold, Trend Forecast Update Video - 19th Sep 19
Baby Boomers Are the Worst Investors in the World - 19th Sep 19
Your $1,229 FREE Tticket to Elliott Market Analysis & Trading Set-ups - 19th Sep 19
Is The Stock Market Other Shoe About To Drop With Fed News? - 19th Sep 19
Bitcoin Price 2019 Trend Current State - 18th Sep 19
No More Realtors… These Start-ups Will Buy Your House in Less than 20 Days - 18th Sep 19
Gold Bugs And Manipulation Theorists Unite – Another “Manipulation” Indictment - 18th Sep 19
Central Bankers' Desperate Grab for Power - 18th Sep 19
Oil Shock! Will War Drums, Inflation Fears Ignite Gold and Silver Markets? - 18th Sep 19
Importance Of Internal Rate Of Return For A Business - 18th Sep 19
Gold Bull Market Ultimate Upside Target - 17th Sep 19
Gold Spikes on the Saudi Oil Attacks: Can It Last? - 17th Sep 19
Stock Market VIX To Begin A New Uptrend and What it Means - 17th Sep 19
Philippines, China and US: Joint Exploration Vs Rearmament and Nuclear Weapons - 17th Sep 19
What Are The Real Upside Targets For Crude Oil Price Post Drone Attack? - 17th Sep 19
Curse of Technology Weapons - 17th Sep 19
Media Hypes Recession Whilst Trump Proposes a Tax on Savings - 17th Sep 19
Understanding Ways To Stretch Your Investments Further - 17th Sep 19
Trading Natural Gas As The Season Changes - 16th Sep 19
Cameco Crash, Uranium Sector Won’t Catch a break - 16th Sep 19
These Indicators Point to an Early 2020 Economic Downturn - 16th Sep 19
Gold When Global Insanity Prevails - 16th Sep 19
Stock Market Looking Toppy - 16th Sep 19
Is the Stocks Bull Market Nearing an End? - 16th Sep 19
US Stock Market Indexes Continue to Rally Within A Defined Range - 16th Sep 19
What If Gold Is NOT In A New Bull Market? - 16th Sep 19
A History Lesson For Pundits Who Don’t Believe Stocks Are Overvalued - 16th Sep 19
The Disconnect Between Millennials and Real Estate - 16th Sep 19
Tech Giants Will Crash in the Next Stock Market Downturn - 15th Sep 19
Will Draghi’s Swan Song Revive the Eurozone? And Gold? - 15th Sep 19
The Race to Depreciate Fiat Currencies Is Accelerating - 15th Sep 19
Can Crypto casino beat Hybrid casino - 15th Sep 19
British Pound GBP vs Brexit Chaos Timeline - 14th Sep 19
Recession 2020 Forecast : The New Risks & New Profits Of A Grand Experiment - 14th Sep 19
War Gaming the US-China Trade War - 14th Sep 19
Buying a Budgie, Parakeet for the First Time from a Pet Shop - Jollyes UK - 14th Sep 19
Crude Oil Price Setting Up For A Downside Price Rotation - 13th Sep 19
A “Looming” Recession Is a Gold Golden Opportunity - 13th Sep 19
Is 2019 Similar to 2007? What Does It Mean For Gold? - 13th Sep 19
How Did the Philippines Establish Itself as a World Leader in Call Centre Outsourcing? - 13th Sep 19
UK General Election Forecast 2019 - Betting Market Odds - 13th Sep 19
Energy Sector Reaches Key Low Point – Start Looking For The Next Move - 13th Sep 19
Weakening Shale Productivity "VERY Bullish" For Oil Prices - 13th Sep 19
Stock Market Dow to 38,000 by 2022 - 13th Sep 19 - readtheticker
Gold under NIRP? | Negative Interest Rates vs Bullion - 12th Sep 19
Land Rover Discovery Sport Brake Pads and Discs's Replace, Dealer Check and Cost - 12th Sep 19
Stock Market Crash Black Swan Event Set Up Sept 12th? - 12th Sep 19
Increased Pension Liabilities During the Coming Stock Market Crash - 12th Sep 19
Gold at Support: the Upcoming Move - 12th Sep 19
Precious Metals, US Dollar, Stocks – How It All Relates – Part II - 12th Sep 19
Boris Johnson's "Do or Die, Dead in a Ditch" Brexit Strategy - 11th Sep 19
Precious Metals, US Dollar: How It All Relates – Part I - 11th Sep 19
Bank of England’s Carney Delivers Dollar Shocker at Jackson Hole meeting - 11th Sep 19
Gold and Silver Wounded Animals, Indeed - 11th Sep 19
Boris Johnson a Crippled Prime Minister - 11th Sep 19
Gold Significant Correction Has Started - 11th Sep 19
Reasons To Follow Experienced Traders In Automated Trading - 11th Sep 19
Silver's Sharp Reaction Back - 11th Sep 19
2020 Will Be the Most Volatile Market Year in History - 11th Sep 19
Westminister BrExit Extreme Chaos Puts Britain into a Pre-Civil War State - 10th Sep 19
Gold to Correct as Stocks Rally - 10th Sep 19
Market Decline Will Lead To Pension Collapse, USD Devaluation, And NWO - 10th Sep 19
Stock Market Sector Rotation Giving Mixed Signals About The Future - 10th Sep 19
The Online Gaming Industry is Going Up - 10th Sep 19

Market Oracle FREE Newsletter

Nadeem Walayat Financial Markets Analysiis and Trend Forecasts

Greece Bond Market Crash, Europe and ETFs

Interest-Rates / Global Debt Crisis Apr 29, 2010 - 10:54 AM GMT

By: Ron_Rowland

Interest-Rates

Best Financial Markets Analysis ArticleWhen Americans hear about Greece, the first thought that comes to mind is usually “ancient history.” Now Greece is all over the headlines for its financial woes.

But if truth be told, Greece hasn’t done anything different from many other countries, including the U.S.! The government simply spent too much money, the citizens enjoyed too many overly-generous social programs, and eventually the bill came due. Now someone has to pay up — and the Greeks don’t have the cash.


The complication is that Greece is part of the euro currency union. This means other member countries can’t just let Greece default on its debts. Therefore a grand negotiation is now underway to figure out how they’ll share the pain.

Greece’s economy is crumbling before our eyes.
Greece’s economy is crumbling before our eyes.

A further complication is that several other European nations, such as Portugal, Ireland, Italy and Spain, are teetering on the edge of disaster too.  

So today I want to draw your attention to some exchange traded funds (ETFs) that focus on Europe. You can think about it as a list of ETFs to avoid for now — or a shopping list to consider buying whenever Greece and the rest of Europe finally touch bottom.

Buying Europe in an ETF …

Numerous ETFs will give you a broad-based allocation to European stock markets. The two most popular are:

  • Vanguard European ETF (VGK)
  • iShares S&P Europe 350 (IEV)

Both these funds include 15+ different countries, but they aren’t equally weighted. The United Kingdom, France, Germany and Switzerland are the biggest European markets and together they account for the bulk of the holdings. And there is little or no direct exposure to Greek stocks.

ETFs have erased many of Europe’s borders for investors.
ETFs have erased many of Europe’s borders for investors.

Another group of Europe ETFs includes multiple countries in various smaller combinations …

iShares MSCI EMU (EZU) is interesting because it includes only those nations that use the euro as official currency. That means EZU is heavy on France and Germany and omits the U.K. and Switzerland. Greece weighs in at just 1.2 percent of this ETF.

Since the worst of the economic problems are in Southern Europe, you might have better luck traveling north on the map to look at the Scandinavian countries. Global X FTSE Nordic 30 (GXF) does this for you, with exposure to Sweden, Denmark, Norway, and Finland.

iShares MSCI Emerging Markets Eastern Europe (ESR) and SPDR S&P Emerging Europe (GUR) specialize in the smaller, less developed European markets. In most cases these are the former communist countries that remain closely tied to Russia, such as Hungary and Poland — and, of course, Russia itself.

Buying Europe — One Country at a Time

Another way to invest in Europe is with single-country funds. This can be useful because it lets you customize a portfolio with just the allocation you think will work. Here are some ETFs you might want to consider:

  • iShares MSCI Austria (EWO)
  • iShares MSCI France (EWQ)
  • iShares MSCI Germany (EWG)
  • iShares MSCI Italy (EWI)
  • iShares MSCI Netherlands (EWN)
  • iShares MSCI Spain (EWP)
  • iShares MSCI Sweden (EWD)
  • iShares MSCI Switzerland (EWL)
  • iShares MSCI United Kingdom (EWU)
  • Market Vectors Poland (PLND)
  • Market Vectors Russia (RSX)
  • SPDR S&P Russia (RBL)

A couple of sector-based, European ETFs might be worth a look, too:

  • iShares MSCI Europe Financials Sector (EUFN)
  • iShares FTSE EPRA/NAREIT Europe (IFEU)

IFEU is a real estate fund, by the way, a fact which is not at all apparent in the unwieldy name.

Inverse Europe …

Finally, ProShares UltraShort MSCI Europe (EPV) is a 2X daily leverage inverse fund. That means it’s designed to move twice (200 percent) the inverse (opposite) of the daily performance of the MSCI Europe Index before fees and expenses.

In other words, if for example the index drops 10 percent, the ETF’s shares could rise 20 percent.

Try to trade when the U.S. and European markets are open.
Try to trade when the U.S. and European markets are open.

Given how crazy the situation is right now in Europe, you might be tempted to jump right into EPV. Be careful if you do: It’s best used as a short-term trading vehicle. EPV can be a big winner if your timing is just right, or it can hand you big losses if you are even a little bit early or late.

BONUS: Trading Tip

If you buy or sell any kind of Europe-focused ETF, it’s usually a good idea to enter your order in the morning hours, U.S. time. That’s because most European markets are still open and there is typically more liquidity. You’ll see the savings in the form of a tighter bid/ask spread and quicker fills.

Best wishes,

Ron

This investment news is brought to you by Money and Markets. Money and Markets is a free daily investment newsletter from Martin D. Weiss and Weiss Research analysts offering the latest investing news and financial insights for the stock market, including tips and advice on investing in gold, energy and oil. Dr. Weiss is a leader in the fields of investing, interest rates, financial safety and economic forecasting. To view archives or subscribe, visit http://www.moneyandmarkets.com.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules