TSC Ratings provides exclusive stock, ETF and mutual fund ratings and commentary based on award-winning, proprietary tools. Its "safety first" approach to investing aims to reduce risk while seeking solid outperformance on a total return basis.

The worst-performing exchange traded funds in May, which largely bet against commodities, might be good investments for short sellers who are bullish on the

stock market


Of the 25 biggest losers, the first 24 use inverse strategies that cause them to gain value as their underlying index falls. The remaining fund tracks an index that measures bearishness. If the

stock market

rebounds significantly, a short position in these funds could generate big gains.

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Half of these ETF laggards track commodities inversely, specifically metals and energy. The weakening dollar lit a fire under crude prices in May, causing them to soar 30% to $66.31 a barrel. The falling dollar also boosted demand for gold and silver, whose prices rose 10% and 27%, respectively.

The worst-performing ETF, the

PowerShares DB Crude Oil Double Short ETN

(DTO) - Get DB Crude Oil Double Short Exchange Traded Notes Report

, sank 54%. Five other energy funds made the list, including the

ProShares UltraShort DJ-UBS Crude Oil Fund

(SCO) - Get ProShares UltraShort Bloomberg Crude Oil Report

, down 41%; the

Direxion Daily Energy Bear 3X Shares ETF

(ERY) - Get Direxion Daily Energy Bear 3X Shares Report

, down 34%; and the

TheStreet Recommends

Rydex Inverse 2X S&P Select Sector Energy ETF


, down 26%.

Seven other anti-commodity-based funds were caught betting against the trend including losses of 41% in the

ProShares UltraShort Silver Fund

(ZSL) - Get ProShares UltraShort Silver Report

, 32% in the

PowerShares DB Commodity Double Short ETN


and 20% in the

PowerShares DB Gold Double Short ETN

(DZZ) - Get DB Gold Double Short Exchange Traded Notes Report


The last fund on the list, the

iPath S&P VIX Short-Term Futures ETN

(VXX) - Get iPath Series B S&P 500 VIX Short-Term Futures ETN Report

, fell 17% as fewer speculators bet against the

S&P 500 Index

using put options.

Kevin Baker became the senior financial analyst for TSC Ratings upon the August 2006 acquisition of Weiss Ratings by TheStreet.com, covering mutual funds. He joined the Weiss Group in 1997 as a banking and brokerage analyst. In 1999, he created the Weiss Group's first ratings to gauge the level of risk in U.S. equities. Baker received a B.S. degree in management from Rensselaer Polytechnic Institute and an M.B.A. with a finance specialization from Nova Southeastern University.