At first blush, an ETF in exotic markets with an expense ratio of 0.59%, a p/e ratio of 9 and a dividend yield of 4.5% looks attractive. Indeed, with turnover of only 7 per annum, the SPDR S&P Emerging Middle East & Africa ETF (GAF) even appears to be well managed. Having risen from a low of USD 34.14 on the 9^th March, to the current price USD 47.78, it is even performing well. Why, then, does GAF almost always appear in the most ‘shorted’ threshold securities list?

The first thing to note is that in Q1 2009, the stock has traded at a 1.59% premium to NAV. That is quite a premium for an ETF.

UBS AG (UBS), which at USD 12.90 is down 68% year to date, faced its accusers at its EGM yesterday. The main topics were to inform shareholders about the changes to its compensation system and allow them to vote on measures related to the government bailout. It seems that everyone hates the stock, but this could well be the time to speculatively buy. Despite the noise from angry shareholders, upset that the bank has faced two bailouts, the management appears to now be focused on the long-term and more closely aligned with the value creation of the firm. In short, the compensation package was in investor interests.

Anyway, it is not pay that is the big issue as far as the stock price goes, it is the risk systems. They proved to be totally inadequate. In this respect, the bank has quietly made changes. It no longer reports internal management Value at Risk, but instead regulatory Value at Risk. At the same time, it has increased the scope of its internal management Value at Risk to more accurately represent risk exposures and related hedges: important changes that should benefit transparency and control. On the same vein, UBS AG recently increased hedging activity against credit exposures in its over-the-counter derivatives portfolio.

Investors tend to assume gold stocks are a safe haven during times of market turmoil. Harmony Gold (HMY) is no exception; hence the reason why this year’s 33% fall in the ADR is so disappointing.

Africa's third largest gold miner managed to pull the rabbit out of the hat by delivering third quarter net income of 490 million rand (USD 40.3 million), recovering from a loss the preceding quarter.

Once again we are promised that ENI SpA (E) is on target to deliver the highest upstream production growth from amongst the majors over the next 6-7 years. Claudio Descalzi (COO E&P) promises us greater than 400 kboe/d by 2011. Kashagan, we are told, will be on stream just after that in 2012. Let's put that into perspective. The project was initally scheduled to come on stream in 2008, then 2009. Now: we are told all is okay, following a complex reconfiguration of this challenging offshore project. With total reserves of greater than 14 billion boe, the project is not to be sniffed at. Neither are the 12 projected start ups in Africa and another ten in the rest of the world. That's the bull case for the stock.

So then why has the ADR fallen 33% YTD? Why is the stock pice of ENI SpA likely to become 'more' not 'less' volatile?