Last week, we discussed physically backed ETFs, which are just as the name implies: each share is backed by a physical product. Right now, physically backed ETFs only give exposure to precious metals. You won’t find an ETF backed by barrels of oil or livestock. [4 Types of Commodity ETFs.]

Physically backed ETFs have a special appeal to smaller investors who either lack the space for storage, or the inclination to hunt down and pay for storage themselves. In ETFs backed by physical metals, all you need to do is show up and buy a share. The rest is taken care of for you. [Contango and What You Can Do About It.]

These ETFs tend to correlate more closely to the spot price than commodity funds that hold equities or futures. The taxes are a bit different, too: profits in bullion-based ETFs are taxed at 28% (but consult your personal tax professional for specific advice). [ETFs and Taxes: What You Should Know.]

Physically backed commodity ETFs also enjoy the other benefits of ETFs, including cost-efficiency, tax efficiency and transparency (the bullion holdings in these funds are subject to regular audits and the results are posted on the ETF provider’s website).

For more stories about commodity ETFs, visit our commodity ETFs category.

• SPDR Gold Trust (NYSEArca: GLD)
• ETFS Physical Platinum (NYSEArca: PPLT)
• iShare COMEX Gold Trust (NYSEArca: IAU)
• ETFS Physical Palladium (NYSEArca: PALL)
• iShares Silver Trust (NYSEArca: SLV)
• ETFS Silver Shares (NYSEArca: SIVR)
• ETFS Gold Shares (NYSEArca: SGOL)

While marking your ballot for best actor, best actress and best costumes might be fun and games for you, picking a winner is no game for the Academy of Motion Picture Arts and Sciences. The organization will use a system – called preferential voting – that generates yearly complaints from statistician nerds and conspiracy theorists everywhere, reports Christy Grosz for The Los Angeles Times.

The film that earns the 2010 best picture Oscar will  take home the trophy after having earned a majority of No. 1 votes. And even if you couldn’t care less who wins or loses, Steve Martin and Alec Baldwin are sure to give us a few good laughs for the evening, as the host the 82nd annual awards show. [Watch the Leisure and Entertainment ETF.]

Which picture do you think will take home the gold? And just so you know, Oscar is not solid gold. The little guy is made of gold-plated britannium.

For more stories about leisure and entertainment, visit our leisure and entertainment category.

• SPDR Gold Shares (NYSEArca: GLD)

• PowerShares Dynamic Leisure & Entertainment (NYSEArca:PEJ)

What’s pushing gold up, down and all around these days?

• Concern about Greece. Thankfully, the debt-riddled country has pushed through billions in budget cuts. While they’ve sparked unrest in the form of strikes, this also means that the European Union could extend a bailout package to further assist the nation. [Gold ETF: Fact and Fiction.]
• Safe Haven. Remember back in 2008, when investors couldn’t get enough of gold and other safe-haven instruments? While the economy looks much better now than it did then, there are still a lot of questions that lack clear answers. When will consumers begin to really spend? When will jobs come back? And that real estate recovery…how is that coming?
• Currencies. As the crisis in Greece deepened, investors were loath to hold the euro. While the dollar has been gaining ground on the euro, there are skeptics who doubt it will last. Those skeptics found a home in gold as a currency alternative. [Precious Metals and the Regulators.]

Gold prices yesterday settled at $1,139.90 an ounce, down slightly from the highest price it reached since Jan. 11.

For more stories about gold, visit our gold category.

• SPDR Gold Shares (NYSEArca: GLD)

• ETFS Gold Trust (NYSEArca: SGOL)

• iShares COMEX Gold Trust (NYSEArca: IAU)

• PowerShares DB Gold Fund (NYSEArca: DGL)

An increasing federal deficit coupled with a large decline in the U.S. dollar may eventually translate into rapid inflation and higher metal prices, while the dollar’s recent strength and higher interest rates could mean that precious metals will drop in value, comments Jonathan Bernstein for ETFZone. [Hedge Inflation With These ETFs.]

That’s why investors need to be prepared to act accordingly. Not all metals have a similar reaction to shifting market conditions.

ETFs offer exposure to precious metals such as gold, silver, platinum and palladium, and base metals like copper, nickel and lead. Precious metals are lightly counter-cyclical, affected by interest rates and the dollar, while base metals are highly cyclical, performing well in a strong economy. [4 Factors Influencing Metals ETFs.]

Commodity ETFs come in a variety of incarnations; which you choose is up to you. It depends on the kind of exposure you want, what kind of risk you’re willing to endure and taxes you’re willing to deal with.

Funds can be physically backed by the metal itself, it can have ownership of futures contracts to buy the metal, it can hold companies involved in the mining and production of a metal. [Copper ETN: Forging Ahead?]

A fund that is backed by the physical commodity has the metal stored in a vault. Investors should note that these funds have storage fees calculated into their expense ratios. Also, physical bullion trades are taxed by the IRS at the collectibles rate of 28% instead of the long-term equity rate of 15%. Investors should still consult their tax experts for specific advice, though. [What's Driving Platinum and Palladium ETFs?]

• SPDR Gold Shares (NYSEArca: GLD)
• iShares COMEX Gold Trust (NYSEArca: IAU)
• iShares Silver Trust (NYSEArca: SLV)
• ETFS Physical Gold (NYSEArca: SGOL)
• ETFS Physical Silver (NYSEArca: SIVR)
  
• ETFS Physical Platinum Shares (NYSEArca: PPLT)
• ETFS Physical Palladium Shares (NYSEArca: PALL)

Funds may also own futures contracts to buy the metal. Contracts are rolled over before expiration, and another contract is purchased in its place. Rolling over contracts generates trading fees. Futures contracts are taxed at a lower maximum rate of 23%.

• PowerShares DB Precious Metals Fund ETF (NYSEArca: DBP)
• PowerShares DB Base Metals Fund ETF (NYSEArca: DBB)
• PowerShares DB Gold Fund ETF (NYSEArca: DGL)
• PowerShares DB Silver Fund ETF (NYSEArca: DBS)
• Ultra Gold ETF (NYSEArca: UGL)
  
• ProShares UltraShort Gold (NYSEArca: GLL)
• ProShares Ultra Silver (NYSEArca: AGQ)
• ProShares UltraShort Silver (NYSEArca: ZSL)

Many metals ETFs give investors exposure to the companies that mine and produce the metals. While such funds don’t give you access to spot prices, they have their own advantages. One big one is that mining companies can continue to do well if a commodity’s price steps back, but remains far above the cost of production. Such funds also lack the big day-to-day swings that have a tendency to vex futures- and physically-backed metals ETFs.

• SPDR S&P Metals & Mining (NYSEArca: XME)
• Market Vectors Gold Miners (NYSEArca: GDX)
• Market Vectors Junior Gold Miners (NYSEArca: GDXJ)
• EGS DJ Emerging Markets Metals & Mining Titans (NYSEArca: EMT)

Lastly, funds may offer exposure through notes or exchange traded notes (ETNs). ETNs are taxed by the long-term equity rate of 15%. ETNs are unsecured debt backed by the full faith and credit of the issuer. They have no tracking error. [ETNs: Everything You Want to Know.]

• ELEMENTS Rogers International Commodity Metal ETN (NYSEArca: RJZ)
• E-TRACS UBS Bloomberg CMCI Industrial Metals ETN (NYSEArca: UBM)
• iPath DJ AIG Industrial Metals ETN (NYSEArca: JJM)
• PowerShares DB Base Metals Long ETN (NYSEArca: BDG)
• iPath AIG Copper (NYSEArca: JJC)
• iPath DJ AIG Lead (NYSEArca: LD)
• iPath DJ-AIG Aluminum (NYSEArca: JJU)
• iPath DJ AIG Nickel (NYSEArca: JJN)
• E-TRACS UBS Platinum (NYSEArca: PTM)
• iPath DJ AIG Platinum (NYSEArca: PGM)
  
• PowerShares DB Gold Short ETN (NYSEArca: DGZ)
• E-TRACS UBS Short Platinum ETN (NYSEArca: PTD)
• PowerShares DB Base Metals Double Long ETN (NYSEArca: BDD)
• PowerShares DB Base Metals Double Short ETN (NYSEArca: BOM)
• PowerShares DB Base Metals Short ETN (NYSEArca: BOS)
• PowerShares DB Gold Double Long ETN (NYSEArca: DGP)
  
• PowerShares DB Gold Double Short ETN (NYSEArca: DZZ)

For more information on metals, visit our precious metals category or base metals category.

For full disclosure, Tom Lydon’s clients own shares of XME.

Max Chen contributed to this article.

Why is everyone so concerned about inflation? The primary argument supporting it is massive government spending, which tend to sink the greenback by expanding the money supply. As consumer prices rise, your buying power will shrink, and the spiral begins.

Matthew Bandyk for U.S. News & World Report has a few strategies investors can us to take up arms against inflation. [Ways to Play a Federal Rate Hike.]

• TIPS: Treasury inflation-protected securities use government-issued bonds whose principal is tied to the inflation rate as measured by the consumer price index (CPI). The CPI might not immediately reflect a fall in the value of the dollar stemming from a fall in Treasuries, since general weakness in the economy or other factors could keep the prices of other goods down. iShares Barclays TIPS Bond  (NYSEArca: TIP) [Your TIPS Questions Answered.]



• Real Estate: Land is a tangible asset that can trump inflation. But use caution, because housing prices do not always go up along with other types of inflation. If rates rise rapidly, though, real estate may not pay off for you. SPDR Dow Jones REIT (NYSEArca: RWR) [Protect Yourself from the Government's Deficit.]



• Gold: While the gold market might be hot now, it is no sure thing for the future. The metals is a classic inflation hedge, and can hold value, but be aware that gold prices are also sensitive to supply-and-demand just as much as inflation. SPDR Gold Shares (NYSEArca: GLD) [More Stories on Gold ETFs.]

This year’s Olympic medals are some of the most expensive in recent history– that’s partly because metals prices have skyrocketed, and also in part because these medals are the heaviest in history, say Robert Hum and Ariel Nelson for CNBC. The price for one of these babies is $501 – not including the cost of crafting them.

Olympic gold medals actually contain more silver than gold. The International Olympic Committee requires gold medals to be made up of 92.5% silver and just 6 grams (0.19 troy ounces) of gold. Weighing between 500 grams to 576 grams (depending on the particular medal), the Vancouver medals are the heaviest medals ever, as they are over one pound. [Why Gold and Silver ETFs are All the Talk.]

Since the 2002 Olympics, gold futures have risen 258%, while silver futures have jumped 247%. Even since the start of the Beijing Olympics in 2008, gold prices have risen 27%. [China's Buying Spree.]

As the Olympics wind down, another source for gold and silver demand is poised to reveal itself: China may be toying with the idea of increasing it reserves of gold and silver. The country’s sovereign wealth fund recently invested in natural resource stocks and a government decree gave a nudge to Chinese citizens to buy silver, says Martin Hutchinson for NuWire Investor.

For more stories about precious metals, visit our precious metals category.

• iPath DJ UBS Copper Sun-Index ETN (NYSEArca: JJC)

• iShares MSCI Silver Index (NYSEArca: SLV)

• ETFS Physical Shares Silver (NYSEArca: SIVR)

• SPDR Gold Shares (NYSEArca: GLD)

According to InvestmentNews, the list of the top ten funds researched by financial advisors last year is based on information given by Morningstar.

1. iShares Barclays TIPS Bond (NYSEArca: TIP). With an expense ratio of 0.20%, advisors sought out this ETF for its cheap exposure to Treasury inflation-protected securities. If inflation rises, investors should consider switching regular bonds like Treasuries to Treasury Inflation-Protected Securities (TIPS). TIPS bond’s principal and interest payments grow with inflation. [More on TIPs.]



2. SPDR Gold Shares (NYSEArca: GLD). GLD has produced double digit returns in four of the five past years. Gold prices have been rising because currencies the world over are mostly in a weakening phase and governments are printing money fast and furiously. Experts are predicting that gold investment this year is going to soar, thanks to another year full of potential financial uncertainties. [More on Gold.]



3. iShares MSCI EAFE Index ETF (NYSEArca: EFA). Another popular choice of advisors. The fund was up 27% last year and it has an expense ratio of 0.35%. The argument for investing globally is based on low correlations – if one area of the world tanks, another may be thriving. Investing overseas gives you diversification away from U.S. assets. [How Being Under-allocated Globally Could Hurt.]



4. iShares MSCI Emerging Markets (NYSEArca: EEM). Last year, international stock markets were all the rage, sparking billions of dollars of inflows into ETFs. The MSCI index provider managed to nab about 70% of that money. [More on Emerging Markets.]



5. iShares iBoxx $ Investment Grade Corporate Bond (NYSEArca: LQD). LQD has produced positive returns in each of the last seven years. Corporate bond spreads are the highest they’ve been since November, rising at the fastest pace in more than two months. The spike is on the heels of concerns that the state of government finances will hinder the recovery and make it more challenging for companies to make their debt payments. [More on Corporate Bonds.]



6. iShares Barclays Aggregate Bond Fund (NYSEArca: AGG). AGG provides exposure to government bonds, government-sponsored bonds (Fannie and Freddie, etc.), and corporate bonds. The bond and bond-related ETF markets have experienced quite a year, but the good times may soon come to an end. The specter of inflation and likely hikes in interest rates may cut away at hefty returns seen in  recent months. [Bond ETFs: Good Times Ending?]



7. PowerShares DB Commodity Index (NYSEArca: DBC). Commodities are still a good way to diversify an otherwise bland portfolio, but before you invest, assess your risk tolerance and act accordingly. If you want more safety, check out broad commodity funds that give you exposure to a diversified basket of commodities. The downside is that you won’t fully capitalize if any one commodity is performing particularly well. [More on Commodities.]



8. Vanguard Emerging Markets ETF (NYSEArca: VWO). Productivity in the emerging markets is improving. Emerging markets also enjoy a higher level of economic freedom. Economic freedom measures how free citizens of a particular country are to work, produce, consume and invest how they please. Emerging markets account for 50% of global gross domestic product, and counting. In fact, between 2008 and 2025, developing economies are projected to account for more and more of global GDP. [Reasons to Stick with Emerging Markets.]



9. iShares COMEX Gold Trust (NYSEArca: IAU). Gold prices more than doubled over the past few years. Gold may soar higher because of inflationary worries, higher investment demand in gold, Central Banks hoarding gold, potential for a currency crisis and any signs of major currency devaluations. [Reasons Gold May Still Have Life.]



10. SDPR S&P 500 (NYSEArca: SPY). SPY is one of the go-to ETFs for exposure to the broader market. The S&P 500 is made up of 500 of the largest companies that are publicly traded in the United States. This is the index that is most watched by professional traders. SPY is extremely liquid, currently averaging more than 166 million shares per day. [Indexes ETF Investors Should Know.]

For full disclosure, some of Tom Lydon’s clients own shares of EEM.

Max Chen contributed to this article.

Wholesale price  levels are on the rise, however, many other sectors within the economy are anchored. Luca Di Leo and Sarah Lynch for The Wall Street Journal report that the producer price index for finished goods rose a seasonally adjusted 1.4% on the month in January, the Labor Department said Thursday, after increasing an upwardly revised 0.4% in December. Aside from food and energy prices, few signs of inflation exist in the economy, giving the Fed more reason to keep interest rates low.

Leading indicators rose 0.3% in January, which signals that the economy should continue to grow, at least through spring. Tali Arbel for Associated Press reports that the leading indicators gauge is designed to forecast economic activity in the next three to six months.

Wal-Mart (NYSE: WMT) earnings are showing a higher quarterly profit amid mixed reports at retail stores that fell short of Wall Street’s expectations. Reuters reports that profit for the fourth quarter that ended Jan. 31 rose to $4.63 billion, or $1.21 a share. iShares Dow Jones U.S. Consumer Services (NYSEArca: IYC) is flat today; Wal-Mart is 8.7%.

Microsoft (NASDAQ: MSFT) won unconditional European Union approval on Thursday for its planned search deal with Yahoo (NASDAQ: YHOO) to challenge market leader Google (NASDAQ: GOOG), says Foo Yun Chee for Reuters. Microsoft’s Bing will become the search engine for both, while Yahoo focuses on attracting big advertisers. [For more stories about technology, visit our technology category.]

• Technology Select Sector SPDR (NYSEArca: XLK): Google is 6.5%; Microsoft is 10.3%

Gold prices are slipping as weak U.S. jobs data takes away the possibility of an interest rate hike at the Federal level. Matt Whittaker for The Wall Street Journal reports that in recent trading, April gold was down $1.10, or 0.1%, at $1,119 an ounce on the Comex division of the New York Mercantile Exchange. [For more stories about commodity ETFs, visit our commodity category.]

• SPDR Gold Shares (NYSEArca GLD)

Analysts are sharply divided these days: on one side are the dollar bulls who think the dollar will strengthen and gold will weaken; on the other side are the dollar bears, who think gold is only warming up. Willfred J. Hahn for Index Universe questions those who believe gold’s price is set to soar again and has a few points to make about the current market:

• Gold prices have been rising because currencies the world over are mostly in a weakening phase and governments are printing money fast and furiously.
• The current gold rush is at best, already over. If everybody is talking about it, it may be finished. And the timing of jumping onto the golden bandwagon presents itself at an expensive price.[Regulators and Precious Metals.]
• The previous “gold rush” that occurred between 1980 and 1982 took  the price of an ounce of gold then to above $800 from a level of less than $100. Emotional buying and the herd mentality never pays off, and eventually gold came back to around $260 levels. If you own gold, it’s a store of wealth but you can’t live on income generated from the metals.
• The bottom line is that you should watch the financial trends and the 200-day moving average for your answer to the golden question. Look at trends in other commodities, too. There are plenty of them out there and you may not be buying at a premium. [What to Know About Commodities.]

Experts are predicting that gold investment this year is going to soar, thanks to another year full of potential financial uncertainties, says Marketwire. [How Precious Metal ETFs Have Changed Investing.]

Alix Steel for The Street spoke with Mike Maloney, the author of Rich Dad’s Guide to Investing in Gold and Silver, who believes that silver prices could not only hit quadruple digits, but it could outperform gold in the long run. Whatever silver actually does, Maloney says silver should perform alongside gold.

For more stories about commodity ETFs, visit our commodity ETF category.

• ETFS Physical Gold Shares (NYSEArca: SGOL)
• PowerShares DB Gold (NYSEArca: DGL)
• SPDR Gold Shares (NYSEArca: GLD)
• iShares COMEX Gold Trust (NYSEArca: IAU)
• PowerShares DB Silver (NYSEArca: DBS)
• iShares Silver Trust (NYSEArca: SLV)
• ETFS Physical Silver (NYSEArca: SIVR)
  

China Investment Corp., the country’s sovereign wealth fund, purchased 2 million shares worth $78.6 million, or 3.48% of total shares, of United States Oil (NYSEArca: USO), and acquired 1.45 million shares worth $155.6 million, or 0.4% of total shares, of SPDR Gold Shares (NYSEArca: GLD), report Christian Schmollinger and Kyoungwha Kim for BusinessWeek. China is now the fourth-largest holder of USO. China bought a range of ETFs, covering everything from Japan to global materials funds, in an apparent bet on the global recovery.

Timothy Condon, chief Asian economist with ING Groep NV, says that China is hedging against the impact that their purchases of raw materials have on commodity prices. In total, CIC’s filing accounts for $9.6 billion of U.S.-listed assets; ETFs make up 25% of that, says John Spence at MarketWatch.

After years of incurring trade surpluses, China is standing on huge reserves of cash that could be used to amass more raw materials, according to SteelOrbis. As it stands, the East is purchasing materials from United States and Japanese sources. With higher demand, prices for the materials would inevitably go up. However, European sources are not a large provider to the East, and this may pose a problem to European scrap producers who are over-producing and unable to capture a market for their goods. [China's Quest for Coal and Steel.]

• Market Vectors Steel (NYSEArca: SLX)
• Market Vectors Coal (NYSEArca: KOL)
• PowerShares Global Coal (NYSEArca: PKOL)

According to Destatis, German exports plummeted $1.121 trillion last year while China’s exports totaled $1.202 trillion, reports Geoffrey T. Smith for The Wall Street Journal. Germany has held onto the title of the world’s No. 1 exporter, but China is quickly catching up as a result of the collapse in business confidence and investment during the financial crisis.  [Why China may see more growth.]

For more information on China, visit our China category.

• Shares FTSE/Xinhua China 25 (NYSEArca: FXI)

• SPDR S&P China (NYSEArca: GXC)

• Claymore/AlphaShares China All-Cap (NYSEArca: YAO)

• Claymore/AlphaShares Small Cap (NYSEArca: HAO)

• PowerShares USX Golden Dragon Halter (NYSEArca: PGJ)

Max Chen contributed to this article.