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Top 10 Commodity Producer ETFs


 

 

Our goal in this profile is to help investors wade through the many competing ETF offerings available. Using our long experience as an ETF publication, and nearly 40 years in the investment business, we can help select those ETFs that matter and may or may not be repetitive. The result is a more manageable list of issues from which to view and make selections.

With inflation pressures waxing and waning, many believe it's important to have exposure to commodity-oriented stocks and ETFs. There are many ETF choices from which to choose. We've cobbled some good choices together and where repetitive choices exist, we've paired some together  -- similarities are just too hard to ignore.

We're not ranking these ETFs favoring one over another so don't let the listing order mislead you. Although we may use some of these in ETF Digest portfolios it's not our intention to recommend one over another.

Our technical analysis methodology involves using, where possible, monthly charts with enough data to allow investors to stay on the right side of the 12 month moving averages. Further, when market prices move too far above or below this moving average investors can assume a correction in the other direction will eventually take place. In this regard caution is advised.

ProShares and Direxion Shares both offer inverse and leveraged long ETFs for those investors wishing to hedge or speculate.

MOO (Van Eck Argibusiness ETF) follow the DAXglobal Agribusiness Index which consists of companies that derive at least 50% of their revenues from the business of agriculture. The fund was launched in August 2007. The expense ratio is .59%. AUM (Assets under Management) equal $5.2 billion with average daily trading volume of 2.2M shares. As of early August 2011 the annual dividend $.33 making the current yield .70% and YTD return -8.16%.

Data as of August 2011

MOO Top Ten Holdings & Weightings

  1. Potash Corporation of Saskatchewan, Inc. (POT): 7.97%
  2. Monsanto Company (MON): 7.71%
  3. Deere & Co (DE): 7.11%
  4. Syngenta AG (SYENF): 6.38%
  5. Wilmar International Ltd (F34): 6.11%
  6. Archer-Daniels Midland Company (ADM): 5.04%
  7. BRF - Brasil Foods SA ADR (BRFS): 4.54%
  8. Mosaic Co (MOS): 4.37%
  9. Yara International ASA (YAR): 4.05%
  10. Agrium Inc (AGU): 4.03%

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XLE (SPDR Energy Select ETF) follows the Energy Select Sector Index which includes companies in oil, gas, consumable fuels and energy equipment and services. The fund was launched in December 1998. The expense ratio is .20%. AUM equal $7.5 billion and average daily trading volume is 25M shares. As of early August 2011 the annual dividend was $.29 making the current yield .86% and YTD return -2.61%.

Both ProShares and Direxion shares have inverse and leveraged products available.

Data as of August 2011

XLE Top Ten Holdings & Weightings

  1. Exxon Mobil Corporation (XOM): 16.61%
  2. Chevron Corp (CVX): 13.38%
  3. Schlumberger NV (SLB): 8.01%
  4. ConocoPhillips (COP): 4.71%
  5. Occidental Petroleum Corporation (OXY): 4.36%
  6. Halliburton Company (HAL): 3.76%
  7. Apache Corporation (APA): 3.43%
  8. Anadarko Petroleum Corp (APC): 3.00%
  9. Baker Hughes Inc. (BHI): 2.79%
  10. National Oilwell Varco, Inc. (NOV): 2.71%

A popular alternative choice is IGE (iShares Natural Resource ETF) which follows the S&P North American Natural Resources Sector Index. It is paired here as an alternative owing to it similar holdings and trending characteristics. This fund was launched in October 2001. The expense ratio is .48%. AUM equal $1.8 billion and average daily trading volume is 400K shares. Over the same period the annual dividend is $.40 making the current yield 1.05% and YTD return -6.45%.

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