Moreover, the manager is looking at Hong Kong and German stock ETFs.
“We believe that valuations remain fairly low and Hong Kong equities still have an opportunity to rise substantially in 2013,” Cucchiaro said.
“Germany should benefit in the coming year from its tie to the euro and the economic stimulus being provided by the European Central Bank,” Cucchiaro added. Additionally, he pointed out that large exporters are well-positioned in a weaker euro environment.
For the fixed-income side, the manager has been putting more into emerging-market bond ETFs, notably those tied to Asian issues denominated in local currencies.
- WisdomTree Asia Local Debt Fund (NYSEArca: ALD)
- PowerShares Chinese Yuan Dim Sum Bond Portfolio (NYSEArca: DSUM)
- Market Vectors Renminbi Bond ETF (NYSEArca: CHLC)
- Guggenheim Yuan Bond ETF (NYSEArca: RMB)
Domestically, the portfolio managers are overweighting ETFs that track the tech-heavy Nasdaq-100 Index.
- PowerShares QQQ (NasdaqGM: QQQ)
“Tech still looks undervalued to us,” Cucchiaro said. “We think that like last year, the Nasdaq-100 is positioned to outperform the S&P 500 in 2013.”
For more information on the ETF industry, visit our current affairs category.
Max Chen contributed to this article.
Full disclosure: Tom Lydon’s clients own QQQ.