April's Top ETFs: Energy, Natural Resources

The month of April showed that the best average returns per category or sector for exchange traded funds were in Energy/Natural Resources (6.67%), Global Equity (5.19%) and domestic Growth & Income (5.43%).

In all, there were quite a few sectors and categories that performed well, which in general reflected the recent run up on Wall Street and world markets. This really applied only to equity markets buoyed by earnings, further Federal Reserve intervention and other generally positive news for the month of April.

However the bond market, after posting solid returns for March, fared worse as capital moved out of this market and into equities. With investors feeling more confident about the U.S. economy, and hence the U.S. dollar, money also came off the table from Precious Metals ETFs.

Some of the most profitable funds were the MACROshares Oil Up(UCR Quote), returning 25.39% for the month; Rydex 2x S&P MidCap 400 ETF(RMM Quote), up 16.74%; and two Chinese ETF's, the SPDR S&P China ETF(GXC Quote) 17.97% and the PowerShares Golden Dragon Hltr USX China(PGJ Quote), returning 17.97% and 15.54% respectively.

With this week's data for mid-May showing soft economic conditions in the U.S., there may be a reversion back away from the equity markets and into bonds and precious metals.

The reasoning behind this appears to be that further evidence of a slowdown implies further assistance from the Federal Reserve via lower rates (which will compress yields i.e. bid the price of bonds up), or other strategies to stabilize the bond market and banking sector in general. A U.S. slowdown places uncertainty into the minds of investors - hence, there is also a flight to precious metals, especially gold. I

In the end, it all seems a bit of a crapshoot until we have a more certain economic outlook.

ETF Category	No. of Funds	1 Month Return
Sector - Energy/Natural Res	51	6.67
Growth & Income	26	5.43
Global Equity	21	5.19
Emerging Market Equity	16	4.56
Equity Income	158	4.51
Sector - Utilities	12	4.50
Sector - Financial Services	20	4.34
Growth - Domestic	160	4.23
Non-US Equity	114	3.77
Corporate - High Yield	3	3.77
Sector - Health/Biotechnology	41	3.01
Municipal - National	11	1.82
Municipal Single State	2	1.72
Emerging Market Income	2	0.78
Corporate - Investment Grade	4	0.67
Municipal - High Yield	1	0.25
General Mortgage	1	0.04
General Bd - Investment Grade	9	-0.17
Government Bond	19	-1.68
Global Income	1	-2.33
Sector - Precious Metals	10	-2.61

ETF Name	Category	TICKER	1 Month Return
HOLDRS B2B Internet	Growth - Domestic	BHH	29.73
MACROshares Oil Up	Sector - Energy/Natural Res	UCR	25.39
SPDR S&P China ETF	Non-US Equity	GXC	17.97
Rydex 2x S&P MidCap 400 ETF	Equity Income	RMM	16.74
PowerShares Gldn Drgn Hltr USX Chn	Global Equity	PGJ	15.54
ProShares Ultra Utilities	Sector - Utilities	UPW	13.84
HealthShares Cardiology	Sector - Health/Biotechnology	HRD	12.51
iPath MSCI India Index ETN	Emerging Market Equity	INP	12.24
PowerShares FTSE RAFI Intl Real Est	Growth & Income	PRY	12.04
ProShares Ultra Financials	Sector - Financial Services	UYG	10.99
DB Gold Double Short ETN	Sector - Precious Metals	DZZ	8.82
PowerShares Insured CA Mun Bond	Municipal - National	PWZ	5.50
PowerShares High Yield Corp Bond	Corporate - High Yield	PHB	4.18
PowerShares Preferred Port	General Bd - Investment Grade	PGX	2.28
iShares S&P CA Municipal Bond	Municipal Single State	CMF	2.19
iShares iBoxx $ Inves Grade Corp Bd	Corporate - Investment Grade	LQD	1.25
iShares JPMorgan USD Emg Mkts	Emerging Market Income	EMB	1.16
PowerShares VRDO Tax-Free Weekly	Municipal - High Yield	PVI	0.25
iShares Lehman Short Treasury Bond	Government Bond	SHV	0.09
iShares Lehman MBS Fixed-Rate Bond	General Mortgage	MBB	0.04
SPDR Lehman Intl Treasury Bond ETF	Global Income	BWX	-2.33