September ETFs: Best and Worst Industry Performers

by: Gary Gordon

Quick! Would you be able to name the best performing, unleveraged, sector ETF for September?

The First Trust ISE Revere Natural Gas Fund (NYSEARCA:FCG) produced a slick 15.4%. In spite of the collapse of natural gas prices in 2009, companies engaged in exploration, storage and transportation of the commodity have nearly doubled (99% gain) off of the March lows.

The 2nd best percentage outcome? Claymore NYSE Arca Airline Fund (NYSEARCA:FAA) raked in 15.3% for the month. Continental, Delta and Southwest must have done something very unique to give this low-volume ETF the high octane jolt. (Or maybe it was the sub-$70 price on crude!)

Indeed, commodities themselves were relatively flat, including oil, nat gas, precious metals and base metals. On the other hand, the companies that mine/explore/drill for resources were some of the hottest percentage gainers on the month.

Best and Worst Sector Performers in September 2009
% Return
First Trust ISI Revere Natural Gas (FCG) 15.4%
Claymore NYSE ArcaAirline Fund (FAA) 15.3%
Market Vectors Gold Miners (NYSEARCA:GDX) 14.6%
SPDR Oil and Gas Equipment Services (NYSEARCA:XES) 13.9%
SPDR Metals and Mining (NYSEARCA:XME) 12.6%
Market Vectors Steel (NYSEARCA:SLX) 12.3%
SPDR Oil and Gas Exploration Production (NYSEARCA:XOP) 10.0%
S&P 500 3.6%
Regional Bank HOLDRS (NYSEARCA:RKH) 0.4%
First Trust Amex Biotech (NYSEARCA:FBT) -0.3%
iShares DJ Health Providers (NYSEARCA:IHF) -0.6%
SPDR Biotech (NYSEARCA:XBI) -0.8%
SPDR Homebuilders (NYSEARCA:XHB) -3.0%
iShares Dow Jones Home Construction (NYSEARCA:ITB) -6.2%

Perhaps it goes without saying, but real estate demand still weighs heavy on the minds of investors. Residential prices appear to have stabilized with recent data showing 3 months of mild home appreciation in the 20 largest metro areas.

However, investors passed on SPDR Homebuilders (XHB) and DJ Home Construction (ITB) in September. They also appear leery of traditional banking, as banks in the KBW Bank Fund (KBE) and in Regional Banking (RKH) lost ground as well.

On the flip side, it doesn’t seem to matter what the spot price of aluminum, iron ore, crude oil, gold, silver or natural gas may be… the stocks of these companies keep climbing! Year-over-year, Gold Miners (GDX) and Market Vectors Steel (SLX) are up 34% and 5% respectively.

Full Disclosure: Gary Gordon, MS, CFP is the president of Pacific Park Financial, Inc., a Registered Investment Adviser with the SEC. The company may hold positions in the ETFs, mutual funds and/or index funds mentioned above.