I previously offered screen results for high yield ETFs trading above their 200 day moving average and with an average volume of greater then 50k. The response was well received so below are the results of a screen for ETFs with a yield of 7% or greater with no volume or trend requirement.

As I stated previously, many on the list can be especially volatile. Generally, the higher the dividend yield the more volatile the security and at-risk is the dividend (the market is not going to give something for nothing). In addition, many companies are cutting dividends during this difficult period, which means when it comes time for an equity based ETF to pay out its next dividend, the payment could be less then it has paid in the past.

Sales appear to be bottoming: Per US Advanced Retail Sales data, seasonally adjusted retail sales appear to have bottomed in March with a 12.1% year-over-year decline. June’s 10.0% decline was the best showing since last November as the declines started to accelerate into this recession. Last year’s fiscal stimulus remains as a near term challenge for retail comparisons.

The number of ETFs on Deathwatch continues to grow as we enter 2009. My current list contains 139 names: 97 ETFs and 42 ETNs. The list includes any ETF/ETN that is at least six months old and had an Average Daily Value Traded of less than $100,000 in December.

Exchange Trade Notes are suffering from concerns of default risk. The Lehman Brothers (LEHMQ.PK) bankruptcy, which resulted in the demise of three ETNs, is causing investors to hesitate before throwing money into these products. Unless ETN sponsors to take steps to calm investor fears, their representation on the list is likely to grow in the coming months.

The household wealth statistics for the last quarter may well have been anticipated, and priced in, by the equity markets. But, most certainly, the current level of the major indexes does not incorporate the real possibility that the data for this and the next quarter will show another 10-15% decline in American family balance sheets. In brief, short today and shop away.

The Federal Reserve announced that net worth for households and non-profit groups dropped by $2.81 trillion (to $56.5 trillion) between July and September, the largest downward shift since 1952. Given the shape of the credit, housing and stock markets since September, another $6 trillion-plus decline by early 2009 is a fairly safe conclusion, according to all economic indicators. Blaming the jobless rate, the Fed acknowledged that the fundamentals governing consumer spending will not improve in the near-term. But perhaps more than unemployment, it is the under-employment rate which has been eroding family incomes. At least 10 million Americans will be seeking better, full-time jobs by early-2009.

The news for Black Friday is that sales rose. Reports range from 3% to 7%, but is that really more? The consensus is that retailers heavily discounted prices.

Sales may have risen over the same time last year, but it’s difficult to imagine that profits rose in the process.

An article in this weekend's Wall Street Journal about ETFs with dwindling market caps caught our attention.  More and more ETFs seem to be trading hardly any volume these days, and many have already liquidated or announced plans to liquidate in the future.  As Wall Street usually does with everything, it seems to have gone overboard with ETFs, creating too many too fast.  Eventually only the biggest and strongest will survive.

We looked at more than 700 US ETFs and ETNs to see which ones are struggling the most with low market caps and volume.  The average market cap of all ETFs we looked at was about $816 million, but 131 (about 18%) have market caps lower than $10 million.  The market cap of the largest ETF, SPY, is also greater than the sum of the market caps of the smallest 596 (84%) ETFs.  Talk about income inequality!  The article notes that anything less than $50 million "probably loses money for the firm that sponsors it." 

The global junk bond default rate rose to 2.0% in May from 1.7% in April, according to Moody’s Investors Service. A year ago, the global speculative-grade default rate stood at 1.5%.

In the first five months of 2008, the global default rate doubled itself from a level of 1.0% at the end of 2007, Moody’s said in its latest report on the sector.

By Murray Coleman

With 136 exchange-traded funds still on the market with less than $10 million in assets, the closing of five unpopular bond exchange-traded funds by Ameristock this week isn't likely to be the last, say industry observers.

Global Retail and Consumer Goods & Services ETFs
iShares S&P Global Consumer Discretionary Sector Index Fund (RXI)

WisdomTree International Sector Funds
WisdomTree International Basic Materials Sector Fund (DBN)
WisdomTree International Communications Sector Fund (DGG)
WisdomTree International Consumer Cyclical Sector Fund (DPC)
WisdomTree International Consumer Non-Cyclical Fund (DPN)
WisdomTree International Energy Sector Fund (DKA)
WisdomTree International Financial Sector Fund (DRF)
WisdomTree International Health Care Sector Fund (DBR)
WisdomTree International Industrial Sector (DDI)
WisdomTree International Technology Sector Fund (DBT)
WisdomTree International Utilities Sector Fund (DBU)

This first interview is with Luciano Siracusano, Director of Research for ETF firm WisdomTree Asset Management, which has sponsored the interview. It works like this:

Roger Nusbaum submits: Some good questions from Seeking Alpha contributor Richard Kang about the cornucopia of new ETFs listed or in the pipeline:

He asks for my opinion about WisdomTree method of dividend weighting compared to PowerShares RAFI funds which scores companies by sales, income, book value and dividends. I just did a write up for TSCM about the Rydex equal weight sector ETFs. In the course of writing that article I saw that most of the RAFI sector funds look a lot like the Sector SPDRs in terms of weighting a $200 or $300 billion at 20% of the fund or thereabouts. These lopsided funds are quickly fading as being the best choice.