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

Funds for Auto Industry Bulls

In the absence of an appropriate pure play option, auto hungry ETF investors have been focused to direct their attention towards proxy products.

With over 12% of its portfolio dedicated to companies related to the automotive industry, a fund like the SPDR S&P Retail ETF (XRT) may be appealing. Rather than targeting car markets, XRT's auto exposure is spread across retailers including Group 1 Automotive (GPI) and Pep Boys (PBY). The iShares Dow Jones U.S. Consumer Goods Index Fund (IYK) is another product to consider. The 9% slice of IYK dedicated to the auto industry includes both automotive retailers and car manufacturers.

Precious metals may not be the most obvious choice for investors looking for exposure to the car industry, but funds like the ETFS Physical Palladium Shares (PALL) and the ETFS Physical Platinum Shares (PPLT) are two additional funds auto bulls may want to keep in mind. These two shiny metals are used extensively in the production of catalytic converters, and will therefore be in a position to benefit as vehicles continue to roll off the lots.

Ultimately, however, the best way for investors to gain comprehensive exposure to the recovering global auto industry at this time is not through ETFs, but rather using a mutual fund. In an attempt to provide investors with one stop shop exposure to this sector, Michael Weaver, the portfolio manager behind the Fidelity Select Automotive Fund (FSAVX), has compiled a collection of nearly 40 companies, representing both car manufactures and auto parts suppliers. Companies including Ford, Toyota, TRW Automotive Holdings (TRW), and Johnson Controls (JCI) are among the fund's largest positions.

With well over 1,000 products available, investors can typically turn to ETFs in order to satisfy nearly any portfolio need. However, as evidenced by the limited availability of adequately liquid automotive-focused products, there are still areas where this universe can expand.

Written by Don Dion in Williamstown, Mass.


At the time of publication, Dion Money Management held a position in the iShares Dow Jones U.S. Consumer Goods Index Fund.
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
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
Only $49.95
14-Days Free
14-Days Free
PALL $53.09 -0.95%
IYK $109.67 0.11%
F $14.53 -0.14%
GM $36.37 0.08%
TM $124.37 0.41%


Chart of I:DJI
DOW 17,798.49 -14.90 -0.08%
S&P 500 2,090.11 +1.24 0.06%
NASDAQ 5,127.5250 +11.3820 0.22%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs