ETF Spotlight on Market Vectors Retail ETF (RTH), part of an ongoing series.
Hurricane Sandy is devastating the Northeast. There is no "pure play" ETF for home-improvement companies but RTH's top holding include Wal-Mart (OTCPK:NWMT) 14.5%, Home Depot (HD) 9.9%, Amazon (AMZN) 9.5%, CVS Caremark (CVS) 6.5% and Lowe's (LOW) 5.1%.
Assets: $16.5 million.
Objective: The Market Vectors Retail ETF tries to reflect the performance of the Market Vectors US Listed Retail 25 Index, which holds the 25 largest U.S.-listed, publicly traded retail companies.
What You Should Know:
- Van Eck Global sponsors the fund.
- RTH has a 0.35% expense ratio.
- The fund has 26 holdings and the top ten make up 68% of the overall portfolio.
- Sector allocations include 53.2%, consumer staples 39.0% and health care 7.9%.
- The ETF is down 0.9% over the past month, up 4.5% over the last three months and up 19.1% year-to-date.
- RTH is 5.0% above its 200-day exponential moving average.
- "This ETF could be a good fit for investors looking to bulk up their exposure to the consumer," according to Morningstar analyst Robert Goldsborough.
- "It also could make sense for investors looking for a portfolio of very high-quality retailers, given that more than 71% of the assets in this ETF have economic moats, which Morningstar's equity analysts define as sustainable competitive advantages," Goldsborough added.
The Latest News:
- "Mall-based stores will probably take a big hit as consumers focused on discount retailers (like Wal-Mart and Target) and home centers (including Lowe's and Home Depot), basically steering shoppers clear of the malls," Krissy Klinger, a senior international business meteorologist at Weather Trends International, said in a MarketWatch report.
- Klinger believes that home-improvement retailers like Home Depot and Lowe's may experience a net positive impact from Hurricane Sandy as consumers stock up on emergency supplies before the storm and revisit the centers to fix damages.
- While wholesale retailers like Wal-Mart, Target (TGT), which is 5.0% of RTH, and Costco (COST), which is 4.8% of RTH, benefited before the storm, Sandy could cause "an overall negative" impact.
- "The overall impact is going to be a negative for November retail sales with store closings and consumers hunkering down at home during the storm," Klinger added.
Market Vectors Retail ETF
Max Chen contributed to this article.