Biotech Leads ETFs | ETF Trends

Carl Delfeld of Chartwell Advisors reports the top exchange traded fund (ETF) for the day (2/12/07) was the SPDR biotech ETF (XBI) which was up 2.55% and with oil declining about $2, the Claymore Oil Down ETF (DCR) was up 2.24%. The Broadband HOLDRS (BDH) was down 3.44% and the India ETN (INP) lost 2.21%.

A Morgan Stanley report noted that tracking error in 2006 averaged 0.29% for U.S. major-market ETFs, 0.33% for U.S. style ETFs, 0.61% for U.S. sector and industry funds, 0.72% for international portfolios, and 0.09% for fixed-income ETFs. Exchange-traded funds (ETFs) that focus in more illiquid areas such as small-caps and emerging-markets stocks tend to have higher tracking error, due to trading spreads, and liquidity and portfolio-management issues.

First Trust Chindia Index Fund (AMEX: FCI): Introducing a new word to the investing lexicon, the "Chindia" fund tracks the performance of 40 Chinese and Indian companies with American Depository Receipts trading on U.S. exchanges.

Emerging Portfolio Fund Research data shows that equity investors continued to aggressively cut their exposure to China. The $627 million they pulled out of Greater China Equity Funds and ETFs meant that Asia ex-Japan Funds posted net outflows for the second time in four weeks. Investors did maintain their enthusiasm for smaller, more defensive markets such as Singapore (EWS) and Malaysia (EWM).

For full disclosure, some of Tom Lydon’s clients own EWS and EWM.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.