Top 10 Most Overlooked ETFs
December 07, 2012
While FXCH holds the Hong Kong-traded renminbi (CNH)—for details, see my previous blog—it’s still a solid play. Yet it idles with fewer than $5 million in assets, while the WisdomTree Dreyfus Chinese Yuan Fund (NYSEArca: CYB) has over $240 million.
One other fund I wanted to mention is the iShares Gold Trust (NYSEArca: IAU). You might be wondering how an $11.9 billion fund is “overlooked.” But if you compare it with the SPDR Gold Shares’ $74.5 billion in AUM, that’s small potatoes.
IAU provides basically the same exposure, at 15 basis points less per year than the cost of GLD. For the average investor who’s not using a liquidity provider, I just don’t see the rationale for choosing GLD over IAU. IAU is also physically backed with gold bars; is structured the same as GLD; and has the same tax consequences.
Finally, there are those funds that offer unique exposure to some promising investment themes, but most investors probably aren’t even aware of their existence.
Immediately coming to mind are the $16 million Market Vectors Unconventional Oil & Gas ETF (NYSEArca: FRAK), the $7 million EGShares Beyond BRICs ETF (NYSEArca: BBRC) as well as the $8 million Market Vectors Russia Small-Cap ETF (NYSEArca: RSXJ).
Here is my list of the top 10 most overlooked ETFs that deserve better.
10. iShares Gold Trust (NYSEArca: IAU)
9. Guggenheim China All-Cap ETF (NYSEArca: YAO)
8. iShares MSCI India Index Fund (BATS: INDA)
7. Market Vectors Unconventional Oil & Gas ETF (NYSEArca: FRAK)
6. EGShares Beyond BRICs ETF (NYSEArca: BBRC)
5. Guggenheim’s BulletShares Suite of investment-grade and high-yield corporate debt ETFs*
4. SPDR MSCI ACWI IMI ETF (NYSEArca: ACIM)
3. iShares MSCI Emerging Markets Small Cap Index Fund (NYSEArca: EEMS)
2. db-X MSCI Japan Currency-Hedged Equity Fund (NYSEArca: DBJP)
1. CurrencyShares Chinese Renminbi Trust (NYSEArca: FXCH)
*The 16 existing BulletShares ETFs trade under the following tickers: (NYSEArca: BSCC), (NYSEArca: BSCD), (NYSEArca: BSCE), (NYSEArca: BSCF), (NYSEArca: BSCG), (NYSEArca: BSCH), (NYSEArca: BSCI), (NYSEArca: BSCJ), (NYSEArca: BSCK), (NYSEArca: BSJC), (NYSEArca: BSJD), (NYSEArca: BSJE), (NYSEArca: BSJF), (NYSEArca: BSJG), (NYSEArca: BSJH), (NYSEArca: BSJI)
At the time this article was written, the author held a long position in DXJ. Contact Dennis Hudachek at email@example.com.