Only Time Will Tell If Wal-Mart Supplier ETF Has Value
December 14th at 10:00am by Tom Lydon
The Wal-Mart supplier exchange traded fund (ETF) FocusShares ISE Revere Wal-Mart Supplier Index Fund (WSI) is in a category of its own. Roger Nusbaum for TheStreet.com reports that the 30-stock ETF is most heavily-weighted toward consumer staples at 48%, followed by consumer discretionary at 20% and technology stocks at 17%. The S&P Retail Index is used as the benchmark, but Nusbaum suggests it would be more suited to compare to a consumer staples index or the Consumer Staples Sector SPDR (XLP).
The striking factor is the relationship between Wal-Mart and its suppliers. It tends to be testy and the over-reliance on one type of customer could be more of a reason to sell the stock than to buy it. We’ll just need to watch for now.
