Four ETFs Riding an Uptrend

Next up is the SPDR Metals & Mining ETF(XME) that has large holdings of Arch Coal(ACI) and its competitor, Massey Energy(MEE).

Aside from the 37.3% in coal, the fund is also allocated to 31.8% iron/steel, 26.9% other mining, and 4.0% metal fabrication.

Lastly, the iShares Dow Jones U.S. Basic Materials Sector Index Fund(IYM) continues to trend higher. The types of materials stocks held include 52.3% chemicals, 18.3% mining, 12.3% iron/steel, 11.2% coal, and 4.3% forest products.

If the leading holdings of Monsanto(MON), Freeport-McMoRan Copper(FCX), Du Pont(DD), and Dow Chemical(DOW) can pass along price increases to consumers, their prospects are good.

In the current inflationary environment, all four of these funds can benefit from U.S. dollar denominated, hard-asset security holdings.

As with any trading strategy, you can lose money. So, please remember to place your stop-loss orders to help protect you from large moves against your positions. Good luck.

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