This Day On The Street
Continue to site
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

Summer Flight-to-Quality Stocks

Despite gold's popularity, though, I think there's a better bet for fans of hard assets right now: silver. While silver don't necessarily carry gold's cachet, this precious metal does have some interesting attributes. Unlike gold, which has comparatively few industrial uses, silver is actually consumed through many manufacturing processes -- a factor that decreases the available supply of silver and maintains a relatively inelastic demand for the metal. I think that silver is significantly undervalued right now, but there's no telling how long that will last.

The easiest way to get access to silver is the iShares Silver Trust (SLV). In fact, this ETF is the only fund that offers direct exposure to silver right now.

Don't think that precious metals are the only option for investors hoping to fly to quality. Treasuries and money markets are popular choices that have their fair share of complexity.

The money market, which includes everything from T-bills to eurodollars to CDs, is basically a market of short-term borrowing and lending. Because of their short time horizon, money market investments are less risky than other options, but that safety comes with less reward.

For the truly risk-averse investor, T-bills are short-term government borrowings that are as risk-free as possible. They're popular because their denominations make them accessible to individual investors, but because of their minuscule returns, I'd only recommend them to the most pessimistic of investors.

I think other money market instruments are more attractive, but I'd caution buyer beware. Scores of investors have been scammed by disreputable banks offering extremely high-yield CDs. Lack of risk comes at the cost of low returns.

One of the best options for risk-averse investors is through longer-term government debt such as T-bonds. Treasury bonds have maturities of 10 years or more -- and for investors who foresee increased volatility ahead, keep in mind that for longer maturities generates better yields. A couple of popular treasury funds are the iShares Lehman 3-7 Yr Treasury Bond ETF (IEI) and, for international exposure, the SPDR Barclays Capital International Treasury ETF (BWX).

Nearly any low-risk investment you can imagine can be accessed easily these days through ETFs. To see more flight-to-quality funds, have a look at this portfolio on Stockpickr.

-- Written by Jonas Elmerraji in Baltimore.
Jonas Elmerraji is the editor and portfolio manager of the Rhino Stock Report, a free investment advisory that returned 15% in 2008. He is a contributor to numerous financial outlets, including Forbes and Investopedia, and has been featured in Investor's Business Daily, in Consumer's Digest and on
2 of 2

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

Check Out Our Best Services for Investors

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
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
BWX $56.33 0.00%
GLD $122.07 0.00%
IEI $126.03 0.00%
SLV $16.51 0.00%
AAPL $93.24 0.00%


Chart of I:DJI
DOW 17,660.71 +9.45 0.05%
S&P 500 2,050.63 -0.49 -0.02%
NASDAQ 4,717.0940 -8.5450 -0.18%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs