Best of the Week
Most Popular
1. US Housing Market Real Estate Crash The Next Shoe To Drop – Part II - Chris_Vermeulen
2.The Coronavirus Greatest Economic Depression in History? - Nadeem_Walayat
3.US Real Estate Housing Market Crash Is The Next Shoe To Drop - Chris_Vermeulen
4.Coronavirus Stock Market Trend Implications and AI Mega-trend Stocks Buying Levels - Nadeem_Walayat
5. Are Coronavirus Death Statistics Exaggerated? Worse than Seasonal Flu or Not?- Nadeem_Walayat
6.Coronavirus Stock Market Trend Implications, Global Recession and AI Stocks Buying Levels - Nadeem_Walayat
7.US Fourth Turning Accelerating Towards Debt Climax - James_Quinn
8.Dow Stock Market Trend Analysis and Forecast - Nadeem_Walayat
9.Britain's FAKE Coronavirus Death Statistics Exposed - Nadeem_Walayat
10.Commodity Markets Crash Catastrophe Charts - Rambus_Chartology
Last 7 days
Stock Market Dow 30k before End of 2020? - 13th Jul 20
Credit Market Investments Turned Into End-User Risk Again - 13th Jul 20
Investors Are Going All-In on This Coronavirus Proof Industry - 13th Jul 20
5 Vital Insights That You Can Gain From Instagram Trackers - 13th Jul 20
Stop Believing The 'Economy' Is The Same As The Stock Market - 12th Jul 20
Spotify Recealed as The “Next Netflix” - 12th Jul 20
Getting Ahead of the Game: What Determines the Prices of Oil? - 12th Jul 20
The Big Short 2020 – World Pushes Credit/Investments Into Risk Again - 11th Jul 20
The Bearish Combination of Soaring Silver and Lagging GDX Miners - 11th Jul 20
Stock Market: "Relevant Waves Vs. Irrelevant News" - 10th Jul 20
Prepare for the global impact of US COVID-19 resurgence - 10th Jul 20
Golds quick price move increases the odds of a correction - 10th Jul 20
Declaring Your Independence from Currency Debasement - 10th Jul 20
Tech Stocks Trending Towards the Quantum AI EXPLOSION! - 9th Jul 20
Gold and Silver Seasonal Trend Analysis - 9th Jul 20
Facebook and IBM Tech Stocks for Machine Learning Mega-Trend Investing 2020 - 9th Jul 20
LandRover Discovery Sport Service Blues, How Long Before Oil Change is Actually Due? - 9th Jul 20
Following the Gold Stock Leaders as the Fed Prints - 9th Jul 20
Gold RESET Breakout on 10 Reasons - 9th Jul 20
Fintech facilitating huge growth in online gambling - 9th Jul 20
Online Creative Software Development Service Conceptual Approach - 9th Jul 20
Coronavirus Pandemic UK and US Second Waves, and the Influenza Doomsday Scenario - 8th Jul 20
States “On the Cusp of Losing Control” and the Impact on the Economy - 8th Jul 20
Gold During Covid-19 Pandemic and Beyond - 8th Jul 20
UK Holidays 2020 - Driving on Cornwall's Narrow Roads to Bude Caravan Holiday Resort - 8th Jul 20
Five Reasons Covid Will Change SEO - 8th Jul 20
What Makes Internet Packages Different? - 8th Jul 20
Saudi Arabia Eyes Total Dominance In Oil And Gas Markets - 7th Jul 20
These Are the Times That Call for Gold - 7th Jul 20
A Reason to be "Extra-Attentive" to Stock Market Sentiment Measures - 7th Jul 20
The Beatings Will Continue Until the Economy Improves - 6th Jul 20
The Corona Economic Depression Is Here - 6th Jul 20
Stock Market Short-term Peaking - 6th Jul 20
Gold’s Major Reversal to Create the “Handle” - 5th July 20
Gold Market Manipulation And The Federal Reserve - 5th July 20
Overclockers UK Custom Build PC Review - 1. Ordering / Stock Issues - 5th July 20
How to Bond With Your Budgie / Parakeet With Morning Song and Dance - 5th July 20
Silver Price Trend Forecast Summer 2020 - 3rd Jul 20
Silver Market Is at a Critical Juncture - 3rd Jul 20
Gold Stocks Breakout Not Confirmed Yet - 3rd Jul 20
Coronavirus Strikes Back. But Force Is Strong With Gold - 3rd Jul 20
Stock Market Russell 2000 Gaps Present Real Targets - 3rd Jul 20
Johnson & Johnson (JNJ) Big Pharma Stock for Machine Learning Life Extension Investing - 2nd Jul 20
All Eyes on Markets to Get a Refreshed Outlook - 2nd Jul 20
The Darkening Clouds on the Stock Market S&P 500 Horizon - 2nd Jul 20
US Fourth Turning Reaches Boiling Point as America Bends its Knee - 2nd Jul 20
After 2nd Quarter Economic Carnage, the Quest for Philippine Recovery - 2nd Jul 20
Gold Completes Another Washout Rotation – Here We Go - 2nd Jul 20
Roosevelt 2.0 and ‘here, hold my beer' - 2nd Jul 20
U.S. Dollar: When Almost Everyone Is Bearish... - 1st Jul 20
Politicians Prepare New Money Drops as US Dollar Weakens - 1st Jul 20
Gold Stocks Still Undervalued - 1st Jul 20
High Premiums in Physical Gold Market: Scam or Supply Crisis? - 1st Jul 20
US Stock Markets Enter Parabolic Price Move - 1st Jul 20
In The Year 2025 If Fiat Currency Can Survive - 30th Jun 20
Gold Likes the IMF Predicting a Deeper Recession - 30th Jun 20
Silver Is Still Cheap For Now - 30th Jun 20
More Stock Market Selling Ahead - 30th Jun 20
Trending Ecommerce Sites in 2020 - 30th Jun 20
Stock Market S&P 500 Approaching the Precipice - 29th Jun 20
APPLE Tech Stock for Investing to Profit from the Machine Learning Mega trend - 29th Jun 20
Student / Gamer Custom System Build June 2020 Proving Impossible - Overclockers UK - 29th Jun 20
US Dollar with Ney and Gann Angles - 29th Jun 20
Europe's Banking Sector: When (and Why) the Rout Really Began - 29th Jun 20
Will People Accept Rampant Inflation? Hell, No! - 29th Jun 20
Gold & Silver Begin The Move To New All-Time Highs - 29th Jun 20
US Stock Market Enters Parabolic Price Move – Be Prepared - 29th Jun 20
Meet BlackRock, the New Great Vampire Squid - 28th Jun 20
Stock Market S&P 500 Approaching a Defining Moment - 28th Jun 20

Market Oracle FREE Newsletter

AI Stocks 2020-2035 15 Year Trend Forecast

Six Beaten Down ETF's in the Southern Hemisphere Investment Opportunities

Companies / Investing 2010 Jun 10, 2010 - 08:56 AM GMT

By: Ron_Rowland

Companies

Best Financial Markets Analysis ArticleFor the past two weeks, I’ve talked about exchange traded fund (ETF) bottom-fishing. First we looked at nine domestic sector ETFs, then last week we reviewed six opportunities in Europe.

The financial crisis is by no means over, of course. Many markets continue to worsen by the day. And I don’t see any quick solutions for the economy.


So why talk about bargain-hunting?

Because even if now is not the time to buy, it is always the time to think. Planning ahead is crucial to investment success. Whether you like stocks, mutual funds, or ETFs, you need to get familiar with whatever you might buy.

Today I’m going to conclude this three-part series by giving you a few more international ETF names you should keep an eye on. They all did well in the good times, but have been demolished this year. Get to know these tickers now — before they start emerging from the rubble.

We’ll pick up where we left off last week, with …

Beaten-Down ETF #16: iShares MSCI Australia (EWA)

Australia may be known as “the land down under,” but for a long time its stock market was on top of the world. EWA is the easiest way for U.S. investors to buy into Australia. Anyone who did so back at the beginning of 2003 racked up a 285 percent profit by the end of 2007.

Australia provides the raw material that fuels China's growth.
Australia provides the raw material that fuels China’s growth.

Then 2008 hit. And EWA lost almost that entire five-year gain in roughly 15 months. More recently, it plunged 26 percent in about a five-week period from mid-April to mid-May.

Will Australian stocks ever come back? I think so. That’s because the Aussies have a few advantages no one can take away that put them in the catbird seat. Two big ones are …

  • Massive deposits of natural resources, and
  • Geographical proximity to Asia.

As you know, China is growing like crazy and spurring the whole regional economy. And Australian companies supply much of the raw material for those shiny new towers popping up all over Asia. So I think EWA will come roaring back much sooner than North American or European ETFs.

Beaten-Down ETF #17: WisdomTree Pacific ex-Japan (DNH)

Another way to play Australia while adding a little more diversification is with a Pacific ex-Japan ETF. “Ex-” just means “without.” So a Pacific ex-Japan fund covers the Pacific region, minus Japan.

What does this accomplish? Well, Japan is a big fish in a small pond, as far as stock markets go. If you allocate your holdings proportional with market value, Japanese stocks will distort your portfolio.

In the case of DNH, you end up with a fund that is mostly Australian stocks along with some New Zealand and Singapore exposure. DNH hasn’t been around as long as EWA, but the performance patterns are generally similar.

Watch for a bottom in DNH.

Beaten-Down ETF #18: iShares MSCI Brazil (EWZ)

Beaten-Down ETF #19: Market Vectors Brazil Small-Cap (BRF)

Beaten-Down ETF #20: ProShares Ultra MSCI Brazil (UBR)

As you know, Brazil was one of the hottest emerging markets for years before falling along with most everything else in 2008. And the rollercoaster ride is still in motion for Brazil-focused ETFs. For example, EWZ fell more than 24 percent from 1/6/10 to 5/20/10 after gaining 121 percent in 2009.

Volatility or not, Brazil is not going to disappear. Quite the opposite: I expect Latin America’s largest economy to stay on its leadership path.

Unlike already-developed Australia, Brazil still has a lot of room for internal growth. This is one of the reasons I like BRF. Its focus on smaller-cap Brazilian companies means it has less exposure to exports and more upside from Brazil’s domestic growth.

Brazil's growing middle class is driving internal consumption.
Brazil’s growing middle class is driving internal consumption.

And if you want to double your bet on Brazil, look at UBR, a 2x leveraged ETF that gives you 200 percent of the daily performance of the same index (MSCI Brazil) EWZ tries to track. It’s a new ETF and doesn’t have much of a track record yet, but the underlying index is well known.

When the time is right, UBR should really fly. Keep in mind though, since profits and losses can pile up quickly, UBR is an aggressive tool for active traders.

Beaten-Down ETF #21: SPDR DB International TIPS (WIP)

Last summer I told you about ETFs that specialize in TIPS — Treasury Inflation-Protected Securities. These are government bonds that carry a special adjustment feature to keep up with inflation.

If you aren’t concerned about inflation, you’re not alone. Over the last few months many people have become more worried about deflation. As a result, TIPS and the ETFs that hold them have been drifting down. This is especially true in non-U.S. TIPS, which also face currency depreciation relative to the dollar.

Regardless of whether you think inflation or deflation is around the corner, it pays to know what’s available …

WIP is an ETF that specializes in foreign government TIPS. Some of the top holdings come from the United Kingdom, France, Japan, Sweden, Germany, Turkey and Mexico.

WIP was slammed in May, dropping more than 7 percent from its early-month peak to its low point on May 20 — quite a plunge for an unleveraged bond fund!

I’m still not sure if we should expect inflation or deflation. Lately I’m starting to think we may get both. In any case, if the dollar retreats and inflation fears pick up again, WIP could explode higher.

Put it on your radar screen now and look for a chance to get in.

Are there other ETF bargains? Of course …

Over the last three weeks I’ve given you 21 names to watch. The list could be much longer. But I think these are all prime candidates to recover nicely when the economy improves.

When any such improvement will happen is, of course, the million-dollar question. For now, just keep your eyes on these ETFs. Timing will be everything.

Best wishes,

Ron

This investment news is brought to you by Uncommon Wisdom. Uncommon Wisdom is a free daily investment newsletter from Weiss Research analysts offering the latest investing news and financial insights for the stock market, precious metals, natural resources, Asian and South American markets. From time to time, the authors of Uncommon Wisdom also cover other topics they feel can contribute to making you healthy, wealthy and wise. To view archives or subscribe, visit http://www.uncommonwisdomdaily.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