International Materials ETF: Profit From Emerging Market Hunger For Basic Materials

TheStockAdvisors.com is a great deal like Hulbert's Digest; that is, both publications survey the guidance of leading financial newsletters.

Recently, newsletter advisors began giving their top picks for 2008. And there seems to be a substantial interest in capturing profits from global trends.

For example, as emerging countries enhance their infrastructure, the demand for raw materials has increased exponentially. That's led some advisors to recommend specific stocks like Arcelor Mittal (MT) and BHP Billiton (BHP). It's also led some to take a sector approach by recommending the Select Materials Spider (XLB).

Granted, companies like Phelps Dodge and Alcoa (AA) have helped propel XLB to a phenomenal year. Moreover, I gave the Select Materials Spider (XLB) my "thumbs up" back in March.

Still, I think that there's an even stronger way to profit from what's happening worldwide. Specifically, the WisdomTree's International Basic Materials Sector Fund (DBN) scores even bigger successes on the global growth scale.

DBN diversifies around the world and it presents an annual dividend of 4%. In the midst of widespread demand for resources, international material companies may make more sense than U.S. companies alone.

The 2007 results don't lie. The WisdomTree's International Basic Materials Sector Fund (DBN) has outhustled the Select Materials Spider (XLB) by more than 1000 basis points (10%)!

I recently wrote at great length about the demand for raw materials. Nevertheless, I'd rather see investors profit more conservatively from the global growth story than try to "win it all" with highly volatile individual stocks like Freeport-McMorran (FCX).

Comments

[Anand Vishw...:]

Invest in MXI instead. Lower expense ratio.

2007 Dec 31 04:29 AM

[goatfarmer:]

Check that dividend again. According to etfconnect.com the dividend is 0.7%.
www.etfconnect.com/sel...
I'm with Anand on MXI

2007 Dec 31 06:45 AM