China's A-Shares No. 1 In First Quarter

The best performing index in the first quarter was the Shanghai Composite, according to this Investor's Business Daily report.

It notes that a closed-end fund tapping into mainland China's stock exchange, which is largely closed to outside investors,  the Morgan Stanley China A Share Fund (CAF), has gained 49% so far this year. 

The story notes that China-focused ETFs haven't fared as well since they don't invest directly in A-Shares. But technically, they seem to be holding up well, writes IBD markets reporter Trang Ho. 

(Interestingly enough, Van Eck Global has filed to offer the first A-Shares focused open-end ETF. See story here.)

You can read the IBD report here.

Japan Tries Another Round of Stimulus Packages With ETFs

Japanese Prime Minister Taro Aso is moving forward with plans for another round of government-enduced stimulus packages aimed at jolting the country's falling economy. On Tuesday, he ordered officials to buy ETFs and stocks directly to help spur demand, according to this Dow Jones Newswires report.

You can read it here.

Stock Mutual Funds  Reverse Course In February

While several different data collectors provide snapshots of fund flows, the most complete is a survey done each month by the Investment Company Institute. That's due to the fact the ICI is the industry's trade group, so participation is higher and the finding are the most complete available. (It also helps that the ICI doesn't give out any specific fund company details, sticking to overall industry numbers.)

In any case, the latest ICI fund flows report (always a month delayed) came out Tuesday. As reported by Investor's Business Daily, it showed that after a slight uptick in January, investors reversed that trend big-time in February. Bonds were slightly up, however, in the month. 

You can read the story here.

Portfolios Malkiel, Swedroe And Others Suggest

In this interesting story in the Washington Post, Bob Frick of Kiplinger.com notes that cutting fund costs is important in volatile times like these. Index funds and exchange-traded funds, he says, are great ways to go.

He talks to Burton Malkiel and Larry Swedroe, among others, about how they use index funds and ETFs and lists model portfolios that they're actually using. 

You can read the story here. 

Examining Put/Call Options & Indexes

An index put/call ratio can be an effective tool in predicting short-term market moves, concludes this RealMoney analysis on TheStreet.com. 

But there are some caveats that investors should keep in mind, says the author. He takes readers through an example of how well these metrics hold-up under closer scrutiny. 

You can read the story here.

ETFs Holding Relative Strength

In this new Investor's Business Daily piece, markets reporter Trang Ho looks at ETFs that are positive this year and have the best relative strength and accumulation/distribution technical ratings as defined by the CAN SLIM investment methodology. 

You can read the story here.

Another Big Options Play On Utilities ETF

For the second time in nearly a week, a large options trade took place on Wednesday involving the Utilities Select Sector SPDR (NYSE: XLU).

You can read about the bullish activity in this Reuters story here.

Gold Going Mainstream?

In this Wall Street Journal feature,  Gregory Zuckerman notes that recent filings reveal some large investment firms catering to the wealthy -- which used to shun gold -- are now buying the yellow metal. 

According to the article, they've become some of the biggest holders in the SPDR Gold Shares (NYSE: GLD). 

You can read the story here.

Tyco Falls After Removal From S&P 500

Once high-flying Tyco is moving its headquarters as removal from the S&P 500 sent its shares down more at the end of last week.

You can read a brief Associated Press story here.

Arrival Of Pimco, Schwab Could Boost ETFs

In this piece for MarketWatch.com, John Spence looks at how the planned entrance of Pimco and Schwab into the exchange-traded funds marketplace could boost the investment vehicle's popularity.

You can read the story here.

Twittering Online For Stocks

Veteran technology reporter Brian Deagon has an interesting look at a new Web tool that's an add-on for the popular micro-blogging Twitter service.  The so-called StockTwits software lets investors follow their favorite stocks and exchange-traded funds ... as they trade throughout the day with commentary. 

The Investor's Business Daily piece explains how it works and how a large community has already grown of investors sending alerts to one another about what's going on with their portfolios. 

You can read the story here.

Bonds Rally In Anticipation Of Friday's Jobs Report

Treasuries rallied on Thursday ahead of today's government report that a poll of economists predicts will show nearly 650,000 jobs lost in February. That would be the worst such Labor Department report in 60 years, according to the Reuters story. 

You can read it here. 

USO Now Controls Fifth Of Most Traded Oil Futures Contracts

In this Wall Street Journal piece, the growth of the U.S. Oil Fund (NYSE: USO) and its impact on trading in volatile energy markets is reviewed.

You can read the story here.

Sector Bets Can Be Risky

That's the theme of Ian Salisbury's latest column for Dow Jones Newswires. You can read the story here.

Indexing Wins In 2008

Sam Mamudi of MarketWatch notes that index funds beat their active rivals last year.

Tapping into Morningstar's database, he reports that the average actively managed mutual fund lost 40.5% and the average index mutual fund 39.1% in 2008. 

You can read the story here.

Counter-Trend Trading Strategies

At Investor's Business Daily, reporter Trang Ho takes a look at trading strategies by some pros in the wake of the current downward trending market.

You can read the story here.

Reuters Reports Barclays Not Selling BGI

Early Thursday, a Financial Times blog reported rumors that British financial services giant Barclays Plc was considering selling its Barclays Global Investors asset management business. Like other big London-based banks, Barclays has been hit hard by the recent credit crisis. 

But Reuters later reported that an inside source refuted such speculation.  BGI refused to comment. 

You can read the Reuters story here. The Financial Times blog can be found here.

Perhaps even better is an analysis by Financial News Online, a Dow Jones news service. It points out that BGI is the largest asset manager in the world and that it could fetch attractive prices for its banking parent. But it also notes that Barclays' chief executive has recently said that he expects BGI to be a key growth engine for the entire company going forward. 

You can read the Financial News Online story here.

Argentina Cut To Frontier Market Status

MSCI, which earlier had put Argentina on its watchlist, is demoting the country to frontier market status, reports Bloomberg News.

The struggling country had been classified by MSCI as an emerging markets nation, which carries a larger status and will impact its stock weightings in both types of benchmarks. 

You can read the story here.

U.S. Dollar ETF Breaking Away From Pack

In currency markets, when one is down it's likely another will be on the rise, notes Investor's Business Daily markets reporter Trang Ho. 

That's certainly the case with ETFs tracking the U.S. dollar, which staged a technical breakout this week despite the drubbing other currency ETFs are undergoing. 

You can read the story here.

Analyst Finds Bond ETF Full Of Financials

At Morningstar, analyst Scott Burns writes about the importance of knowing what you're buying in an exchange-traded fund. 

He provides an example of a bond fund that fell with stocks during the worst period of the credit crisis last winter. Burns points to the performance of the iShares iBoxx Investment Grade Corporate Bond Index (NYSE: LQD), which fell along with stocks.

That surprised him since bonds are supposed to go the other way when stocks drop. On further review, Burns writes that the ETF had more holdings in financials than he initially realized -- more than 40%.

You can read the story here.

USO Changes Timing Of Rolling Contracts

The United States Oil Fund (NYSE: USO) has decided to roll its contracts over a four-day period, according to a report in the Wall Street Journal.

The move represents a shift from trying to make all of its moves in one day and recognition of the $3.4 billion exchange-traded fund's growing size. 

You can read the story here.

Steady Income From Dividends

John Prestbo, editor and executive director of Dow Jones Indexes, writes on MarketWatch about the changing characteristics of dividend-focused benchmarks as a result of the ongoing market downturn.

You can read the story here.

According to this Q&A at Investor's Business Daily, Carl Delfeld says his Chartwell Global Hedge ETFfolio gained 58.03%  last year. His secret was big does of cash and more trading with inverse exchange-traded funds.

You can read the story here.

Stock Picking Loses Favor

Many institutional money managers and advisers are moving away from stocks and into index funds and exchange-traded funds, reports CNBC's  Jeff Cox.

You can read the story here.

Treasury Bubble Ready To Burst

In this new piece from Investor's Business Daily, Trang Ho talks to advisers who are convinced that exchange-traded funds focusing on Treasuries are facing some tough times. 

You can read the story here.

Record Debt Issuance Ahead

Also, this Forbes story relates how the U.S. Treasury is planning to issue a record $67 billion in government debt this week, which is spooking traders that inflation will soon result as Congress works on a new stimulus plan. 

You can read the story here.

XLF Up, But Options Tell Different Story

According to Reuters, while shares of the Select Sector SPDR Financials ETF (NYSE: XLF) traded up on Monday, options trading activity showed a different story.

Options investors seem to be skeptical about how much a new stimulus program to be announced at 11 a.m. on Tuesday will be able to help banks and financial services firms in the near-term. 

You can read the story here.

Corporate Bond Markets Still Tight

Gus Sauter of Vanguard is one of several fund managers to tell MarketWatch's Sam Mamudi they're still finding it tough to buy corporate bonds today as liquidity remains a problem. 

You can read the story here.

Tracking Error Remains Low In 2008

A new Morgan Stanley report on tracking error found that most exchange-traded funds scored relatively low numbers despite the market's increased volatility, reports John Spence in his blog at MarketWatch. 

You can read the story here.

Launches Vs. Closings

At Investor's Business Daily, markets reporter Trang Ho recaps closings and launches of ETFs last year and looks at what that might mean in 2009.

You can read the story here.

The VIX & New ETNs

At MarketWatch, John Spence interviews Journal of Indexes Editor Jim Wiandt about exchange-traded notes in registration that would attempt to track the so-called "Fear Index."

You can read the story here.

Up, Up & Away

Airlines will be the top industry in 2009, Investor's Business Daily reporter Trang Ho quotes an analyst as predicting. 

Along those lines, just in time comes a new Claymore Securities exchange-traded fund, the first to focus on global airlines. 

You can read the story here.

PowerShares Files To Launch Pair Of Active Bond ETFs

Already the sponsor of one of the first active bond ETFs, PowerShares has filed to open two more. Both will focus on mortgage-backed securities and be run by parent Invesco's institutional managers, according to this piece in the Wall Street Journal. 

You can read the story here.

Barclays Sells Stake To Middle Eastern Investors

In this Bloomberg News report, Barclays Plc said it sold a 32% stake to Abu Dhabi's royal family and two Qatari investors after the London-based bank turned down government aid.

The financial giant is parent to Barclays Capital, issuer of exchange-traded notes, and Barclays Global Investors, the leading ETF family in the U.S. The article notes that shares of Barclays Plc dropped 10% on Thursday to their lowest levels in two decades.

The fall seems to also be attributed to admissions by Barclays that its deal in October includes provisions that could require it to sell more shares at a discount to the group of Middle Eastern investors. 

You can read the story here.

The Plight Of Barclays & ETNs

This Wall Street Journal story running in the paper's Friday morning editions and on its Web site considers the plight of Barclays' latest woes in terms of the many ETN investors holding such notes in their portfolios. 

You can read it here.

Option Activity Jumps In ProShares ETF

Is the sell-off in government bonds about done? This report by Reuters explores the fact that options volume in a ProShares UltraShort Treasury ETF soared on Thursday.

An analyst notes that buying and selling activity in puts with February options expiration dates indicates traders are betting on rising prices and declining yields in Treasuries.

You can read the story here.

Huge Losses Causing Hedge Funds To Cut Fees, Overhaul Strategies

This enterprising Bloomberg News article contrasts the fact that hedge funds recorded record asset losses last year despite the fact that average investment returns by some counts wound up beating the S&P 500. 

Such clashing events are leading experts to expect in 2009 that hedge funds will slash fees and offer more transparency to investors. Interestingly enough, another comparison of corresponding data cited in the article points to a leading hedge fund index starting the new year way ahead of the S&P 500.  

Recovery Of Financials Still Not In Sight?

In this look at the plight of ETFs covering financial stocks, Investor's Business Daily markets reporter Trang Ho writes that the sector continued its fall on Thursday. 

That seems to suggest that the previous day's "monstrous rally was merely an oversold bounce and that a bottom has yet to form," she wrote.

You can read the story here.

Disconnect Between Prices Of Oil Stocks & ETFs?

In a technical look at energy ETFs, markets reporter Trang Ho of Investor's Business Daily considers whether oil company stocks are experiencing a delayed reaction to the tumble in commodities and oil prices.

The story notes that the Energy Select Sector SPDR (NYSE: XLE) has fallen some 50% from its high, much less than actual crude oil prices sold on the NYMEX.

You can read the story here.

Nine ETFs For A New Year

In the past few weeks, stock and fund pickers have been out in force offering their favorite bets for 2009. But Katy Marquardt of U.S. News & World Report takes a concise, well-considered and unique list of exchange-traded funds to offer investors in a new year.

For those of you who've tired of such annual rituals, Marquardt's tight writing makes sense of the reasons she provides for each category and example. 

You can read the story here.

Sizing Up TIPS

The concern right now might be deflation. But sometime down the line, inflation is sure to rear its ugly head.

In this new Motley Fool  investing article, a breakdown of ETFs focused on Treasury Inflation-Protected Securities sizes up the market. 

You can read the story here.

Considering Drawdowns

One way to sort through the mess of 2008 is measuring drawdown rates. That's a fancy term for measuring how much a fund or stock has dropped in any given period from its peak to trough. 

In a short piece not at TheStreet.com titled "ETFs That Have Fallen and Can't Get Up," analyst Kevin Baker takes a look at the range of drawdowns in 2008.

You can read the story here.

Socially Responsible Investing's Growth

The latest word of so-called SRI funds moving into the exchange-traded funds market from Pax World leads Dow Jones Newswires' Ian Salisbury to recap the growth of such ETF products. 

You can read the story here.

Review of 2008 & Beyond

At Investor's Business Daily, reporter Trang Ho takes a look at the bigget winners and losers of 2008. But she also talks to advisors and strategists about which ETFs they're favoring in 2009.

You can read the story here.

Review Of December Returns

With a wide variety of ETFs producing strong returns in December, particularly real estate and gold, TheStreet.com's Sam Patel is warning of a mirage. 

He writes: "Such an eclectic group of funds signifies volatility across the board and suggests a lack of a sustainable trend. Investors unwilling and unable to take substantial risk should not play this market. They would be better served to wait until mid-2009 before making an assessment of whether to invest."

You can read the article, with a chart of December's winners, here.

Time To Short Treasuries?

Thomas Kee, president of Stock Traders Daily, writes in a column for MarketWatch that now's the time to short Treasuries. He likes the ProShares UltraShort Lehman 7-10 Year Treasury (NYSE: PST) to accomplish that task.

You can read the story here.

Another Lost Decade For Japan?

This CNN.com piece takes a short yet interesting look beyond the news that Japan's export business cratered in November. Putting the latest setback into a historical perspective are a number of experts, including an economist at State Street Global Advisors.

The article raises a real concern: Could Japan be facing another lost decade?

You can read the story here.

Move Out Of Cash, Into Stocks

Not to beat the drum more for SSgA, but it's worth noting the global asset manager and exchange-traded funds provider has one of its chief equities managers suggesting to Reuters that it's time to move back into stocks.

You can read it here.  

As Investor's Business Daily notes, this week hasn't started well for many of the exchange-traded funds that have been rebounding strongly since stocks bottomed on Nov. 20. 

In this short sector breakdown,  markets reporter Trang Ho uses technical analysis and charts to quickly run through the slide. 

You can read the story here.

Defense Index's Market-Beating Streak Threatened

The SPADE Index of defense-related stocks had a rough November. As a result, it could see the end of its eight-year streak of outperforming the S&P 500.

You can read the story by Ann Keeton of Dow Jones Newswires here.

Cramer: Outlaw Inverse ETFs

Jim Cramer is urging President-Elect Barack Obama to have his new Securities and Exchange Commission chairman ban ultra-short exchange-traded funds. 

The world's most popular trader fighting the world's most juiced up shorting tool?

This CNBC.com story starts here. 

More ETFs In Brazil?

Bloomberg News has written a new story about new indexes for real estate and consumer stocks in Brazil. Indications are that these launches might be the start of local investors seeing more ETFs appearing outside the U.S. in the near-term.

The executive products director of BM&FBovespa SA, the largest exchange in Latin America, noted in the article that more ETFs in Brazil will likely result in an expansion of fund offerings across the region. The story also observes that Barclays recently entered Brazil with three new ETFs and that the first ETF in the country was created four years ago. 

You can read it here.

Taxing Matters

Investor's Business Daily conducted a question-and-answer session with Robert Green, chief executive of a Web site about tax-efficient trading and author, about everything relating to taxes and exchange-traded funds.

You can read the story here.

Top ETFs In November

The Street.com has a new article out where its head of mutual funds research sizes up the top ETFs in November.

The analyst talks about different funds and his views on their attributes and/or liabilities. But exactly what the criteria he used for putting together this list, and the impact of money flows and/or individual company ratings into his methodology, isn't fully explained. 

You can read it here.

Russian indexes, ETF soar despite downgrade

As MarketWatch's Polya Lesova notes, a downgrade by S&P of Russia's sovereign debt hasn't fazed investors. Following the recent rally, the Market Vectors Russia ETF (RSX) soard on Monday. So did the dollar-denominated RTS index and the ruble-based Micex index.

You can read the story here.

Metals, Basic Materials ETFs blast-off

At Investor's Business Daily, markets reporter Trang Ho  observes that Monday's rally resulted in basic materials and metals ETFs taking-off. That makes sense since markets were moved by optimism that a big bailout of Big Three automakers was in the works. 

As Ho notes, the auto industry is a big consumer of metals and basic materials. She also relates 10-week and 200-week moving averages and Relative Strength ratings in assessing the performance of some ETFs.

You can read the story here. 

The Smart Money's On Green

At least that's the headline of this interesting CNN.com story, which looks at both the fundamental picture for alternative energy in light of current market conditions and suggests ETFs as a good way to play the trend over the longer-term.

More to the point, the article brings up some indexes built to capture this growing field and talks to several well-informed index managers. 

You can read the story here.

ETFs Aren't Always Better

In the latest Street.com review of ETFs, analyst Richard Widows writes that mutual funds aren't always worse than the lower-costing, more transparent form of open-end funds (well, maybe that's putting some words in his mouth).

The article basically brings up the thorns in ETF investors' side -- brokerage commissions and higher trading costs. If you're a dedicated monthly contributor to retirement accounts, ETFs don't always make a lot of sense, notes Widows. 

You can read the story here.

Ross and Wiandt On ETFs

The U.S. News and World Report continues to explore the world of exchange-traded funds. It has an interview with State Street Global Advisors ETF guru James Ross in its most recent issue, and in a companion piece, some quotes from IndexUniverse.com publisher Jim Wiandt.

SSgA's Ross alludes to target date ETFs as being a big area for future ETF product development. Does that mean SSgA will be heating up the competition for iShares' new target dates soon? Ross also believes that the industry may be headed into a period of being gobbled up by bigger asset managers, and that active ETFs may never see the light of day. You can read the Ross interview here.

And for some IU.com-branded comments on ETF use by Wiandt, read the companion U.S. News and World Report piece here.

Inverse ETFs are the darling of the industry at a time when long-only strategies are suffering huge losses in market depreciation and investor assets.

TheStreet.com notes today that the Top 25 ETFs in performance this year are all inverse ETFs. Not surprising, but the article also includes some tips on how to effectively trade these risky inverse ETFs. You can read the story, at your own risk, here.

Winners & Losers

Investor's Business Daily markets reporter Trang Ho has a wrap on November ETF performance and ETF launches. It was not just a good month for inverse ETFs, as TheStreet.com article references, but a banner month for Treasuries and gold.

And IBD does not leave out the month's biggest ETFs dogs, though some think that these dogs are victims of the oversold markets and may be poised for a major comeback. You can read the November ETF analysis here.

Editor's Note: The following is a roundup of what others are writing about exchange-traded funds, index mutual funds and indexes. This column is updated throughout the day by IndexUniverse.com's staff.  Suggestions are welcome by sending comments or links to: <!-- var prefix = 'ma' + 'il' + 'to'; var path = 'hr' + 'ef' + '='; var addy98263 = 'mcoleman' + '@'; addy98263 = addy98263 + 'indexuniverse' + '.' + 'com'; document.write( '' ); document.write( addy98263 ); document.write( '' ); //-->mcoleman@indexuniverse.com. 

Look Who's Talkin'

You've heard it all before. But for the uninitiated, we're providing a link to our own Matt Hougan, who was grilled by reporter Trang Ho for this Q&A appearing in Investor's Business Daily on Tuesday.

Hougan comes through, providing what IU.com readers have become accustomed to -- unblinking analysis and fiercely independent commentary on everything relating to ETFs.

You can see the story here.

The Obama Portfolio

Don't worry, it didn't take this long for someone to propose a portfolio based on the election of Barack Obama.

Already in the past two weeks, dozens of articles have implored investors to take advantage of the election of a new president. This one's a bit dated, first appearing on Kiplinger.com four days ago. But it rises to the top of the pack as writer Laura Cohn takes a rather level-headed look at a so-called "Obama Portfolio."

It starts with a warning that history isn't on the side of those betting on such trends. But conceding a new administration will bring heightened speculation, Cohn takes an educated stab.  And even though she mainly talks stocks, the article does include ETF alternatives for fund investors who prefer safety in numbers. See the story here.

Playing Defense With Sector ETFs

In an interesting look at various strategies to play defensively in this roller coaster market, southern California-based portfolio manager and advisor Gary Gordon looks at the Sabrient Defensive Equity Index ETF (NYSE: DEF). Although it's designed for times just like these, he finds that some of the fund's traditionally defensive sectors aren't providing much of a cushion right now.

Included in Gordon's analysis is a look at taking a different approach using ETFs targeting separate sectors. He notes that DEF's all-in-one portfolio hasn't significantly outperformed the SPDR Trust (AMEX: SPY) by more than a few percentage points.

The analysis developed by Gordon, whose portfolio strategies have been profiled on IU.com in the past, can be found here.

Seven ETFs For Tuesday

Okay, it's a slow news day so far, so we'll bite. Here are TradingMarket's seven ETFs to watch entering a new trading day, given some downgrades in key sector leaders.

Hey, we don't write this stuff ... for the brave at heart, or professional trader, check here.

The Dark Side Of Leveraged ETFs

It's probably not surprising to many investors that value-minded and long-term oriented analysts at Morningstar.com aren't real hip on ETFs and index funds that use leverage.

But here's a new piece by Wenli Tan that adds more fuel to the fire. The author looks at an often overlooked problem with how these funds work in the real world. The article explores something called negative compounding, which can really undercut a leveraged ETF's returns over time. The story provides some specific examples using index funds and ETFs.  You can read it here.

Fundamental ETFs Under The Microscope

Radio talk show host and index-minded writer Ron DeLegge takes a look at fundamental ETFs and how they're faring in the latest bear market.

Among others, he checks into the PowerShares FTSE RAFI 1000 (NYSEArca: PRF) and other FTSE RAFI-based ETFs. DeLegge also makes a pitch for Index Strategy Maps, an idea pioneered by Rick Ferri. See the article here.

Health Care & Pharmas At Near-Term Bottoms?

On his blog, Chris Perruna  makes a case that health care and pharmaceutical stocks have bottomed. Using charts of related indexes and ETFs, he's advising not to trade blindly, but to move selectively in those two sectors, at least on watch lists.

In case you haven't heard of Perruna before, he's an advocate of William O'Neil's  CAN SLIM trading methodology. Of course, he's the stock broker turned data researcher and publisher of Investor's Business Daily. You can check Perruna's take on the system here.

Target-Date Retirement ETFs

Kyle Waller, IU.com columnist and savvy ETF analyst at Wiser Wealth Management, looks at the new  target-date retirement funds by Barclays Global Investors.

Although a short piece, it offers some basic breakdowns of the new funds that might prove helpful to some. See it here.

Big S&P 500 Drop

For technical investors, an extremely short and yet extremely interesting post can be found at Bespoke Investment Group's site. The well-known research group, which we've often cited in articles at IU.com, try to put the S&P 500's extended fall below the key 200-day moving average into perspective.

It does just that in very short order. Without further ado ... click here.