Stocks are a lot cheaper right now than they were just month ago, meaning the exchange traded funds (ETFs) that hold them are marked down too. Is it possible to determine which stocks are a true bargain and which are overpriced?

Michael Krause for examines some of the ETFs on the sale rack and how much they have been marked down. He reminds us that there is more to bargain hunting than buying funds that have been marked down and hoping they will bounce back significantly.

For example foreign ETFs could be good bargains now. The iShares MSCI EAFE (EFA) and the iShares MSCI Emerging Markets (EEM) have rebounded recently but are still down from their July highs. The oddity is that of these two funds, neither are strongly tied to the credit meltdown but have suffered large losses. They are cheaper than their large-cap U.S. counterparts, so it appears likely they were sold by nervous investors.

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

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. 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.