Utility ETFs Prove Utilitarian

Utilities exchange traded funds (ETFs) don’t conjure up images of glamour, but they do have staying power and tend to be more recession-proof than other sectors. They are considered the most stable performers during difficult market conditions and have been on a steady rise since 2003. Joanne Von Alroth of Investor’s Business Daily reports that for the 12 sectors tracked by Morningstar, the utilities 3.43% rise made the group number one for the one month period ended November 27.

Subprime worries mixed with economic discomfort have investors searching for cover. And lets face it-everyone needs water, gas, electricity no matter what the economic conditions. Utility stocks also pay higher dividends than others.

To harness some of the power held by utilities look into:

• iShares Dow Jones US Utilities (IDU) up 16.9% year-to-date
• Utilities Select Sector SPDR (XLU) up 18.1% year-to-date