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David Fry writes a subscription newsletter focused on technical analysis of exchange-traded funds, called ETF Digest (www.etfdigest.com). Dave founded the ETF Digest in 2001 and was among the very first to see the need for a publication that provided individual investors with information and... More
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ETF Digest
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Dave's Daily
My book:
The Best ETFs: U.S. Equities (A Companion Guide To Building Your ETF Portfolio)
  • TOP 10 U.S. & GLOBAL CONSUMER STAPLES ETFs 0 comments
    Dec 1, 2011 1:18 PM | about stocks: XLP, VDC, IYK, FXG, PSL, KXI, PBJ, RHS, IPS

    Our goal in this profile is to help investors wade through the many competing ETF offerings available. Using our long experience as an ETF publication, and nearly 40 years in the investment business, we can help select those ETFs that matter and may or may not be repetitive from one issuer to another. The result is a more manageable list of issues from which to view and make selections.

    Consumer Staples are considered as a more defensive and conservative sector due to the essential needs people have for basic goods as noted in the image above. When markets become more volatile, this sector should offer superior relative performance and stability. When markets are trending strongly higher, it’s not unusual for the sector to lag while still offering positive returns.

    There is currently an expanding list of 20 ETFs oriented to the consumer staples sector with more on the way. The following analysis features a fair representation of ETFs available. We believe from these investors may choose an appropriate ETF to satisfy the best index-based offerings individuals and financial advisors may utilize.

    ETFs are based on indexes tied to well-known index providers including Russell, S&P, Barclays, MSCI, Dow Jones, Wisdom Tree, PowerShares, EG Shares and so forth. Also included are some so-called “enhanced” indexes that attempt to achieve better performance through more active management of the index.

    Where competitive issues exist and/or repetitive issues available at a fee cost saving we mention those as other choices. New issues are coming to market consistently (especially globally) and sometimes these issues will need to become more seasoned before they may be included at least in our listings.

    For traders and investors wishing to hedge, leveraged and inverse issues are available to utilize from ProShares and Direxion and where available these are noted...

    We rank the top 10 ETF by our proprietary stars system as outlined below. If an ETF you’re interested in is not included but you’d like to know a ranking send an inquiry to support@ETFDigest.com and we’ll attempt to satisfy your interest.


    Strong established linked index
    Excellent consistent performance and index tracking
    Low fee structure
    Strong portfolio suitability
    Excellent liquidity


    Established linked index even if “enhanced”
    Good performance or more volatile if “enhanced” index
    Average to higher fee structure
    Good portfolio suitability or more active management if “enhanced” index
    Decent liquidity


    Enhanced or seasoned index
    Less consistent performance and more volatile
    Fees higher than average
    Portfolio suitability would need more active trading
    Average to below average liquidity


    Index is new
    Issue is new and needs seasoning
    Fees are high
    Portfolio suitability also needs seasoning
    Liquidity below average

    We feature a technical view of conditions from monthly chart views. Simplistically, we recommend longer-term investors stay on the right side of the 12 month simple moving average. When prices are above the moving average, stay long, and when below remain in cash or short. Some more interested in a fundamental approach may not care so much about technical issues preferring instead to buy when prices are perceived as low and sell for other reasons when high; but, this is not our approach. Premium members to the ETF Digest receive added signals when markets become extended such as DeMark triggers to exit overbought/oversold conditions.

    For traders and investors wishing to hedge, leveraged and inverse issues are available to utilize from ProShares and Direxion and where available these are noted.

    #1: SPDR Consumer Staples Select ETF (NYSEARCA:XLP)

    READ MORE

    Stocks: XLP, VDC, IYK, FXG, PSL, KXI, PBJ, RHS, IPS
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