The exchange traded fund (ETF) world has exploded, and there are hundreds of funds to choose from. But there are a few that are great ideas that don’t seem to have taken off yet.

Matthew Hougan for Index Universe helps us dig through the market and find hidden gems. These are all ETFs with fewer than $10 million in assets as of July 31, 2008.

• United States 12-Month Oil (USL): With $7 million in assets, and a bevy of potential, it is baffling why USL has not taken off with the commodities boom. In theory USL does not stick close enough to the spot price of oil. Launched Dec. 6, 2007.
• iPath Global Carbon (GRN): The major problem here could be that investors find it hard to fit it into a portfolio. $5 million in assets. Perhaps once industrial production increases, the value of carbon credits will, too.
• Market Vectors Gulf States (MES): $4 million in assets isn’t much compared to the PowerShares equivalent fund with $31 million. The ETF is a pure play on the Middle East, and this region gives a solid diversification tool. July 22, 2008 inception.
• Claymore Alpha/China Small Cap (HAO): $9.8 million in assets. This ETF could be great going forward with the rise of the Chinese middle class and entrepreneurial power. Right now, the bigger state-owned companies dominate and do not reflect the innovation of the middle class.
• NYSE Arca Tech 100 (NXT): $7 million in assets and growing. This ETF lends itself to the tech companies within all three indexes, rather than just the NASDAQ. There is also a 5% cap-weighting so that the companies do not get overweighted. This pure tech play will not get backed up like the NASDAQ 100 did when financials tanked. March 26, 2007 inception.

Tags | Asia, China, Emerging Markets, Energy, Green ETFs, GRN, HAO, MES, Middle East, NASDAQ, NXT, Oil, Technology, USL