This Day On The Street
Continue to site
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Emerging-Markets Large-Caps Take on Dow

The iShares funds are a direct attack on the inroads EG Shares has tried to make on the ETF industry. In addition to the similarities of fund construction, they only charge 0.72% in management fees versus 0.85% for the EG Shares. Even the ticker symbols of the funds are almost identical.

For now, there is little interest in any of the funds. The EG Shares average less than 10,000 shares per day traded, the iShares MSCI Emerging Market Materials Sector Index Fund has only averaged 1,200 shares a day, while the iShares MSCI Emerging Market Financial Sector Index Fund didn't trade one share in its first week on the market. The lack of interest in this space is corroborated by WisdomTree's recent decision to close seven of 10 foreign sector funds. Those included developed- and emerging-market stocks.

The lack of interest, for now at least, is unfortunate because the past decade has shown the importance of country and sector selection. As the S&P 500 dropped 24%, investors willing to invest in specific countries added tremendous value to their portfolios. iShares MSCI Brazil, hardly an obscure investment destination, was up 250%. In that same period, iShares MSCI Hong Kong (EWH) rose 20%. At the industry level, the Financial Select Sector SPDR (XLF) was down 40% for the decade, far worse than the broader stock market, while the Technology Select Sector SPDR (XLK) plummeted 60%.

While some say it's impossible to correctly pick sectors and countries, the market gives the occasional warning about what to avoid, especially at the sector level. Occasionally a sector grows to be too large relative to the S&P 500, often because of some sort of investment mania. In the early 1980s, during the first alternative-energy boom, that sector grew to be 30% of the S&P 500, only to implode. Ten years ago, technology grew to 30% during Internet-stock mania. A few years ago, the financial sector swelled to 22% of the index before crashing in what we're calling the worst financial crisis in 80 years.
2 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
SYM TRADE IT LAST %CHG
EWZ $32.26 -1.56%
IMPUY $4.17 -6.50%
NILSY $16.37 -3.42%
ITUB $10.88 -0.64%
LFC $21.26 -2.30%

Markets

DOW 17,757.91 +138.40 0.79%
S&P 500 2,077.42 +14.31 0.69%
NASDAQ 5,013.1230 +26.2560 0.53%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs