ETF Trends
ETF Trends

We saw March 29 put buying in infrequently traded XME (SPDR S&P Metals & Mining, Expense ratio 0.35%) which has rallied off of its late January/early February lows on reasonably heavy trading volume.

XME ranks as the largest “Metals and Mining” specific ETF in the U.S. listed marketplace, with approximately $367 million in assets under management.

Two smaller ETFs in the space, PICK (iShares MSCI Global Metals & Mining Producers, Expense Ratio 0.39%, $179 million in AUM) and JUNR (Global X Junior Miners, Expense Ratio 0.69%) are worth watching here as well given the presence of put buyers in XME as the fund challenges its 50 day MA in early trading today.

XME has seen flattish net fund flows activity year to date even given the recent uptick in trading volume and interest in the fund while PICK has raised an impressive >$27 million in new assets already year to date.

Top holdings in XME are well known Gold Miner NEM (5.08%), which also happens to be the third largest holding in the well-known Gold Miners ETF GDX (Market Vectors Gold Miners, Expense Ratio 0.53%, $6.5 billion in AUM), followed by HL (4.93%), CDE (4.28%), RGLD (4.13%), and CMP (4.11%).

Like some other SPDRs products XME uses a modified equal weight methodology in determining portfolio exposure to the space. Sub-sectors that are represented among the top ten holdings via XME’s weightings include “Precious Metals,”, “Gold Mining,” “Metals & Mining,” “Steel,” and “Aluminum” according to XTF.com data, and the fund’s top ten holdings are all North America/U.S. domiciled names.

PICK on the other hand has a heavy weighting to Europe (>35%) and to a lesser degree Australia (>16.8%), followed by its U.S. equity exposure of about 14%. Top holdings inside of PICK are BHP Billiton Ltd (11.26% weighting), Rio Tinto PLC (8.60%), BHP Billiton PLC (7.03%), Glencore PLC (6.11%), and Anglo American PLC (3.59%).

From a fund standpoint PICK has more than 81% of its weightings toward international names that operate in the Metals and Mining space. These funds will undoubtedly be sensitive to spot prices of both Industrial and Precious metals prices, as well as to the broad “commodity” prices trend that tends to exist in the marketplace over time as well.

SPDR Metals & Mining ETF

For more information on Street One ETF research and ETF trade execution/liquidity services, contact Paul Weisbruch at pweisbruch@streetonefinancial.com

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