ETF Trends
ETF Trends

When a particular "boom" goes "bust", what should investors do with their related exchange traded funds (ETFs)?

Gary Gordon for ETF Expert takes us back to 2000: the dot-com bulls were running rampant, convinced that the stock prices for those companies could do nothing but soar. In more recent years, the same craze spread through the real estate markets: the world is getting more crowded, there are fewer places to build and it can only send prices higher.

We all know very well by now how that turned out. But Gordon says that this isn’t necessarily to suggest that the newest booming sector – commodities – is primed for a fall. But he does stress that investors should recognize the psychology of fear and greed.

It’s a fact: booms go bust. Therefore, investors need to have a plan to sell.

Some resource ETFs are particularly attractive now, to be sure. Food is scarce. Water is scarce. Oil seems like it can’t be stopped. Naturally, investors will be taking a look at such funds as S&P Metals and Mining (XME) or the PowerShares Water Resources Fund (PHO).

Showing Page 1 of 2