Friday Outlook: Global Markets

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Can the rest of the world, particularly commodity-rich countries, avoid or decouple from U.S. woes? It looks like a few might, but they’re very few thus far.


























The other markets doing well are the Gulf States, where there aren’t any ETFs currently. But you can bet somewhere, someone is working on putting some together.

Is there inflation? Using your own common sense the answer must be yes. It seems the global investment community is making some big bets on hedging that reality.

Have a great weekend!

Disclaimer: Among other issues the ETF Digest maintains positions in: DBA, DBC, GLD, DBP, IEF, IYR, RSX, IFN and EWM.

Comments

[Atl Bob]

Have to confess I struggle to comprehend why many ETF's have miniscule premium/discounts while others soar in either direction. But I really struggle with some of the large discounts (CAF, IFN right now). Is it a function of small volumn? Why would CAF stay over 20% for months? Is a large discount not the big plus it would intuatively seem? I have found no answers but looked many places.

[David Fry]

Closed-end funds are inefficient and lack the popularity with retail as ETFs. Some maintain premiums due to performance which may exceed that which an ETF produce.

Some closed-end funds have a reputation for "rights" offerings which are dilutive and the discount can often reflect this.

Many investors don't pay attention to these details and INP moved to a large premium as many investors mistakenly took it for granted that it was efficiently priced and reflected the NAV properly.

[Atl Bob]

Thanks David. INF and CAF do seem to have less activity than say FXI. And of course, there often seems to be more to the story that meets the average investors eye.

Thanks for the education.