Trucking and Logistics Index: On the Road to Profits

by: Mike Havrilla

The accompanying table (click to enlarge) presents statistics and the seven largest companies by market cap in the ETF Innovators (ETFI) Global Trucking & Logistics Index. The top 35 rated companies in the index managed to post a gain of 1.5% in the past year, compared to losses of 34.5% for the S&P 500 SPDR ETF (NYSEARCA:SPY), 23.8% for iShares Dow Transports (NYSEARCA:IYT), and 24.9% for PowerShares Progressive Transport Portfolio (PTRP) (since its 9/23/08 market launch).

The index includes a total of 66 companies, with 53 eligible for inclusion (with market caps over the $150M minimum) in a new ETF idea which selects the top 35 rated stocks on a semi-active basis with quarterly rebalancing. The index includes companies which derive the majority of their revenue from the following activities:

1.) logistics and management support services for transportation companies

2.) all types of land-based, roadway freight forwarding + freight transportation services

3.) mail + package delivery and transportation services

The seven largest companies by market cap in the index include United Parcel Service (NYSE:UPS), FedEx (NYSE:FDX), Deutsche Post (DPSTYF.PK), C.H. Robinson Worldwide (NASDAQ:CHRW), Kuehne + Nagel (Switzerland: KNIN), TNT (OTC:TNTTY), and Expeditors International (NASDAQ:EXPD).

The equally-weighted index is based on a rating system which factors in each company's market cap weight, revenue weight, historical stock price return, and other factors to choose the Top 35 rated components on a semi-active basis each quarter as a new ETF idea. Less than half of the 66 companies in the index (31) maintain U.S. listings for their stocks, making it a globally diversified index for the trucking and logistics industry.