The past few months have been exceptional for stocks and exchange traded funds (ETFs), as many have made up lost ground. However, three sectors in particular have been able to withstand the global financial crisis and are boasting higher prices than they did a year ago.
Gary Gordon of ETF Expert outlines these three sectors below:
- The first sector is Chinese real estate, represented by the Claymore AlphaShares China Real Estate (TAO). TAO has reaped the benefits of China’s infrastructure stimulus package, which has created jobs and transferred state-owned stock wealth to citizens, enabling them to purchase real estate.
- The second sector is gold, whose performance can be illustrated by the Market Vectors Gold Miners ETF (GDX), which boasts a one-year gain of 6.5% and has reaped the benefits of inflationary worries and concerns. Gold is seen as a popular hedge in an inflationary environment.
- The last sector is biotechnology, which Gordon states has a low correlation with the S&P 500, enabling the sector to mitigate its inherent risks. The First Trust Amex Biotechnology Index (FBT) has a one-year gain of 4.8%.
Kevin Grewal contributed to this article.
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.