ETF Billion Dollar Club Gets Smaller: May 2009

The ETF Billion Dollar Club shrank this month. This exclusive club, consisting of ETFs and ETNs with more than $1 billion of Average Daily Value Traded (ADVT), now has only 15 members based on the most recent month’s trading, down from 19 for the prior month.

The four members on last month’s list that didn’t make the cut were SPDR Select Sector Energy (XLE), iShares FTSE/Xinhua China 25 (FXI), HOLDRS Oil Services (OIH), and ProShares UltraShort QQQ (QID). There were no new members this month.

ETF trading declined more than 20% in April from the prior month, as only $1.59 trillion worth of ETFs and ETNs changed hands - down from more than $2 trillion in March. April ETF trading averaged $75.9 billion per day.

The 15 members of this club, just 1.8% of the ETF population, accounted for 71.4% of the ETF trading in April. With so few funds grabbing the lion’s share of the action, there are valid concerns about the other end of the spectrum - the funds on ETF Deathwatch. These include many products with severe liquidity issues such as days with zero volume and/or outrageous bid/ask spreads.

The table below lists the 15 current members of the ETF Billion Dollar Club, those with an ADVT in excess of $1 billion during the latest month (April, 2009).

ETF Billion Dollar Club - May 2009

Rank	Ticker	Name	ADVT
1	SPY	SPDR S&P 500	$24,327,356,416
2	QQQQ	PowerShares QQQ	$4,662,040,576
3	SDS	ProShares UltraShort S&P500	$3,248,072,960
4	IWM	iShares Russell 2000	$2,851,707,648
5	SKF	ProShares UltraShort Financials	$2,795,528,704
6	FAS	Direxion Daily Financial Bull 3x Shares	$2,366,671,360
7	XLF	SPDR Select Sector Financial	$2,157,093,888
8	FAZ	Direxion Daily Financial Bear 3x Shares	$2,015,272,960
9	EEM	iShares MSCI Emerging Markets	$1,846,892,288
10	IYR	iShares DJ US Real Estate	$1,623,458,944
11	DIA	DIAMONDS Trust	$1,496,565,120
12	SSO	ProShares Ultra S&P500	$1,445,904,896
13	EFA	iShares MSCI EAFE	$1,188,373,888
14	GLD	SPDR Gold Trust	$1,117,319,936
15	SRS	ProShares UltraShort Real Estate	$1,042,578,688

Disclosure: long some of the securities on this list

Comments

[AndrewBaker:]

You don't need to be an Einstein to know why these ETF are the most traded: they're the ones that can make you or lose you the most money in a short space of time. I trade several of them myself, and love it ... Factually, if I sat down and worked it out, I could get a similar return from unleveraged ETF in the same sectors that I can hang onto for a few days, weeks or even months without anything like the risks involved in the leveraged variety, but the buzz is part of it for me, and I need the adrenaline.

May 13 11:14 AM

[Thomas Wagner:]

I suspect that the FED's plunge protection team is also keenly aware of the above. Take a look at the IYR/SRS and SKF on a day like today with the market down 140pts and interest rates rising on the long curve neither SRS or SKF are showing any upside movement. Now who do you think may be in buying today to support these?????. I think uncle ben and company have fiqured out they can short circute the shorts by taking the opposite side of there leverage trading vehicles

May 21 01:01 PM

[Ron Rowland:]

My guess is that SRS (and SKF) are not showing any upside movement today is because IYR, and the securutues that comprise IYR, were up today.

SRS is designed to track double the inverse of IYR on a daily basis. It has nothing to do with the Dow performance.

However, I belive you are suggesting that trading in SRS affects the value of the underlying stocks all day long. I think if the tail were wagging the dog, we would see many price-to-nav imbalances throughout the day, and that is not the case.

Consider the possibility that the financials and REITs really were up today.

May 21 05:36 PM