US ETFs Hit Hard, Asian Markets Split

On Tuesday, the Dow Jones Industrial Average (IYY), the S&P 500 (SPY) and the Nasdaq Composite Index (QQQQ) were each off about 2% for the day. Nasdaq is 2.7% lower on the year. Each of the three indexes suffered its second-biggest decline of the year.

The Russell 2000 index (IWM), which focuses on small stocks, ended down 2.5%. The culprits were weak retail-sales data and the report that delinquency rates for subprime adjustable-rate mortgages reached 14.44% in the fourth quarter of last year, jumping 1.22 percentage points in three months. Investors in European markets and exchange-traded funds fared better as markets fell on average 1% with no markets in positive territory for the day. Asian markets and ETFs were split with Japan down after three straight up sessions and Taiwan (EWT), Thailand, Philippines, India (IIF) and China (FXI) up for the day. Oddly, the lower risk, higher quality markets in Asia had a rougher time today.

It was telling that the iShares Lehman 20+ Year Treasury Bond (TLT) was, aside from the short ETFs, the best performing ETF for the day up 0.60%. The two hardest hit ETFs were the iShares MSCI Malaysia Index (EWM), down 4.97% and iShares MSCI South Africa Index (EZA), down 5.65%.

This year’s more volatile market is driving investors to search for more ways to hedge their portfolios but a March 5th report from Merrill Lynch shows that many traditional asset classes are now too correlated. Merrill suggests five areas that may work to buffer your portfolio: high-quality government and corporate bonds, cash, commodities, gold and, within the stock market, the consumer-staples sector. The Consumer Staples Select SPDR (XLP) didn’t work very well today since it was down 1.9%.

The Chartwell ETF Advisor also uses modest amounts of inverse ETFs is some of its portfolios which go opposite market indexes. For example, the Short S&P500 ProShares (SH) ETF was up 2.09% today.

Comments

[jwt]

can you name any ETF specializing in Vietman also a site where I can find ETF based on a search by the country ?????

thanks for help

john tyrone e-mail; [e-mail]