Nine ETFs for an Uncertain '09

ICLN's portfolio includes large positions in First Solar (FSLR Quote), Covanta Holdings (CVA Quote) and Energy Conversion Devices (ENER Quote). The fund is well-diversified geographically, with significant holdings in the U.S., Brazil, Spain, China and Germany.

Infrastructure expansion and improvement is also likely to be among the stimulus expenditures in the U.S. and elsewhere. The iShares S&P Global Infrastructure Index (IGF Quote) is a potential beneficiary. Besides being 28% invested in the U.S., its holdings are spread across Germany, Canada, France, Spain, Australia, Japan, the U.K. and China.

Infrastructure development requires basic materials such as metals and chemicals. Assuming that stimulus programs are ultimately successful in igniting an economic recovery, a resurgence of demand for industrial materials should result. Add to all that the possibility of an inflationary reverberation from the Federal Reserve's massive monetary stimulus and it make sense to consider the SPDR S&P International Materials ETF (IRV Quote).

Geographically, IRV's holdings are 19% in U.K. investments, 16% each in Canada and Australia, 15% in Japan and 8% in Germany. Its major positions include BHP Billiton (BHP Quote), Rio Tinto (RTP Quote) and Anglo American (AAL Quote).

Finally, someone not interested in second guessing government and central bank strategists might just want an ETF that is as widely diversified as possible -- one that gets a piece of the action no matter what sector gets hot or where, geographically, advances might happen.

Well, if that's the case, the venerable Vanguard Group has something for you! It offers undeniably the most diversified ETF possible: by sector, investment style, industry, country, geographic region, growth prospects, you name it.

The Vanguard Total World Stock ETF (VT Quote) starts with portfolio holdings in blue chip stocks such as ExxonMobil (XOM Quote), General Electric (GE Quote), Microsoft (MSFT Quote) and AT&T (T Quote). But it goes on and on, more than 2,100 stocks of companies located in 47 countries, including both developed and emerging markets around the world.

The fund employs a sampling strategy to replicate the performance of the FTSE All-World Index, a free float adjusted, market-capitalization-weighted index of nearly 3,000 stocks designed to measure the market performance of large- and mid-cap stocks of companies located across the globe.

Gaming the moves of governments in their efforts to battle the global downturn is challenging and potentially profitable. But years from now, it shouldn't be surprising if a few second-guessers don't watch in amazement as an intelligently mixed portfolio of the VT "everything" ETF and the conservative TIPS U.S. Treasury ETF climbs steadily past their investment choices in the performance derby.

NINE EXCHANGE TRADED FUNDS FOR '09 NAME, TICKER & TheStreet.com RATINGS GRADE INCEPTION DATE YIELD (%) TOTAL EXPENSE RATIO(%) 3-MO. TOTAL RET'N (%) 12-MO. TOTAL RET'N (%) INCOME & SAFETY Consumer Staples Select Sector SPDR (XLP) A 12/14/1998 3.14 0.23 -13.88 -15.74 iShares Lehman TIPS Bond (TIP) A+ 12/4/2003 9.44 0.20 -11.01 -6.55 iShares S&P Global Healthcare (IXJ) B+ 11/13/2001 3.30 0.48 -23.08 -30.17 iShares S&P Global Telecom (IXP) A 11/12/2001 5.87 0.48 -19.42 -35.87 Vanguard Utilities ETF (VPU) B+ 1/26/2004 3.97 0.20 -19.26 -26.84 GLOBAL ECONOMIC STIMULUS iShares S&P Glb Infrastructure Idx (IGF) U 12/10/2007 1.49 0.48 -32.58 N/A iShares S&P Global Clean Energy Ind (ICLN) U 6/24/2008 0.00 0.48 -61.77 N/A SPDR SP Intl Materials Sec ETF (IRV) U 7/16/2008 1.44 0.50 -49.27 N/A BROAD EQUITY DIVERSIFICATION Vanguard Total World Stock ETF (VT) U 6/24/2008 0.00 0.25 -33.13 N/A Source: TheStreet.com Ratings (Data as of 11/30/2008) For more information, check out an explanation of our ratings.

Investors who aren't sure whether they should opt for ETFs rather than traditional open-end mutual funds will find some guidance in How to choose Between an ETF and a Mutual Fund.