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Five ETFs With Awesome Winning Streaks

 

Winning streaks are in the news now that the World Series is at hand.

The Colorado Rockies put together an amazing winning sequence that carried them through the National League playoffs while the Boston Red Sox's ticket to the Series was a do-or-die three-game winning streak against the Cleveland Indians.

With the 5-year-old bull market showing some major signs of fatigue, investors might be interested in learning about some exchange-traded funds that that are riding winning streaks.

It turns out that none of the 19 ETFs with sufficient track history will be able to boast a 10-year winning streak at the end of the year. The same holds true for eight-year streaks for the 33 ETFs in existence at the end of 1999.

A search of TheStreet.com Ratings database for ETFs with positive returns over the past five calendar years in addition to the first three calendar quarters of 2007 produced only two hits, which are summarized in the accompanying table below.

The iShares MSCI South Korea Index Fund(EWY) has produced positive results for its holders every complete calendar year since its inception in May of 2000. Its 37.77% gain for the first nine months of this year gives it a reasonable chance of extending its streak to seven calendar years.

The fund's top holdings are Samsung Electronics and Posco. The fund's grade of "A" from TheStreet.com Ratings equates to a buy recommendation.

With its investments focused half a world away from South Korea, the older and smaller iShares MSCI Austria Index Fund(EWO) has produced market gains every calendar year beginning with 2002. It kept modestly above water as the current year passed the three-quarters pole.

The iShares MSCI Austria Index is a veteran among ETFs. There were fewer than 20 such vehicles in existence when it debuted in 1996. Its biggest portfolio holdings are Ersta Bank der Oester Spark and AVM AG. The fund's "A-" grade from TheStreet.com Ratings gives it a "buy" recommendation.

There are three ETFs that have produced positive consecutive calendar-year results since 2002 but have fallen into the red since January of this year. All invest in the real estate industry.

The iShares Dow Jones U.S. Real Estate ETF(IYR) has been up every year beginning with 2001 but was down 5.83% for the year as of Sept. 30. Its biggest holdings are the Simon Property Group(SPG) and Prologis(PLD) and its grade of "C-" from TheStreet.com Ratings equates with a "hold" recommendation.

The iShares Cohen & Steers Realty Major ETF(ICF) has consecutive positive years beginning with calendar 2002. But as of the end of September, it was down 5.04% for the year to date. The fund's biggest holdings are also the Simon Property Group and Prologis and its grade of "C" from TheStreet.com Ratings is in the "hold" range.

Likewise, the Dow Jones Wilshire REIT ETF(RWR) has been up every calendar year beginning in 2002 but is down 4.72% for the year to date through Sept. 30. Its biggest holdings are Simon Property Group and Vornado Realty Trust (VNO) and its grade of "C-" from TheStreet.com Ratings makes it a "hold."

Editor's note: The author has a long-term position in the iShares MSCI South Korea Index Fund in his individual retirement account.

Winning Streaks
Just two ETFs have produced positive returns for each of the past five calendar years and for the first three quarters of 2007.
iShares MSCI Austria Index Fund iShares MSCI South Korea Index Fund
TICKER EWO EWY
EXCHANGE ARCA NYSE
TheStreet.com RATINGS GRADE A- A
TOTAL MARKET RETURNS (%)
YR. TO DATE 1.65 37.77
CAL. 2006 36.76 11.14
CAL. 2005 21.13 53.89
CAL. 2004 73.09 17.22
CAL. 2003 57.00 37.75
CAL. 2002 19.71 3.61
CAL. 2001 -2.14 45.67
SINCE INCEPTION 12.98 18.42
INCEPTION_DATE 3/12/1996 5/9/2000
TOTAL ASSETS ($MIL.) 436.9 1,667.5
Data as of 9/30/2007.
Source: TheStreet.com Ratings.

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Richard Widows is a financial analyst for TheStreet.com Ratings. Prior to joining TheStreet.com, Widows was senior product manager for quantitative analytics at Thomson Financial. After receiving an M.B.A. from Santa Clara University in California, his career included development of investment information systems at data firms, including the Lipper division of Reuters. His international experience includes assignments in the U.K. and East Asia.

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