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XMFSinchiruna (27.48)

The Commodity ETFs in focus

Recs

20

December 17, 2008 – Comments (4)

 Relative performance of commodity ETFs over last 3 months

There are the following ETFs on a comparitive 3-month chart, in order of appearence from top to bottom:

GDX - gold miners equity ETF

MOO - agribusiness equity ETF

PXI - energy equity ETF

HAP - Jim Rogers Hard Asset equity index ETF

SLX - steel equity ETF

KOL -  coal equity ETF

I post this chart not to recommend any given ETF (since I think Fools can perform better with careful stock selection), but merely to offer food for thought as Fools might be looking to step into an already-hot commodity rally. Gold and agriculture stocks have come out strong in the early going, suggesting to me, anyway, that relative opportunities may exist in steel and coal. To the extent that the dollar continues this steep decline, all commodities are likely to rally. Any forestalling of the present rally will be predicated upon a pause or momentary relief rally in the dollar's steep decline.

According to the most knowledgeable gold trader I know of, Mr. Dan Norcini:

"Today’s action in nearly every single market that trades can best be described by one phrase – “It’s all about the Fed”. Their decision to basically print as much money as needed to liquefy the financial system is a signal that the Dollar be damned as far as they are concerned. They will create as many of those little green things as they feel is necessary to free up the logjam in the credit markets. The Forex markets wasted no time whatsoever in administering a sound “arse whooping” to the greenback as it has utterly collapsed...

The only question in my mind at this point is exactly how fast the monetary authorities are prepared to let the dollar fall since it is no longer a matter of “IF” it will fall – they want it down. No one is going to want the dollar to drop off the face of the earth – what they ideally want is a “controlled descent” if such a thing is possible now that any fundamental support beneath the dollar has been eliminated."

All views and ideas welcome as always!

4 Comments – Post Your Own

#1) On December 17, 2008 at 7:24 PM, XMFSinchiruna (27.48) wrote:

 

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#2) On December 17, 2008 at 8:36 PM, SuperPicks (29.03) wrote:

if you have any say, please here this out (though not on subject)

Important CAPs feature now gone?  **Best players in tags**

Clearly one of the coolest features on the CAPs website is the value added by players like you and me, however a big component of that seems to be missing.

When navigating to Tags today, none of them indicate best players within those tags!

Where did that go?

 

The insane value it added to CAPs:

The big picture on CAPs is about beating the market.  Outperformance is essentially captured by big calls on sector or industry calls, the players calling these REALLY provide added value.  For example players that green-thumbed commodity plays before run up and red thumbed them before they imploded.  Or players that called the banking industry crash, or the airline industry crash, or the players that green thumbed the short ETFs back in September.  

Seeing the best players in tags clearly provided a good perspective on those who likely add more value than other players or certain mastery over a certain industry/group. 

Where did that go?

 

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#3) On December 17, 2008 at 8:53 PM, GNUBEE (29.01) wrote:

I demand this Blog fly me to Iran!

 Whoops, sorry, I see this ones already been hijacked.

I'll keep looking.

Sorry to trouble you.

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#4) On December 17, 2008 at 10:02 PM, quitsmoking (< 20) wrote:

TMF, I've ridden these gold miners and MOO down for a few months and hopefully now back up. I'm interested in commodities, foreign stocks and bonds mostly. I'm back in many (3) of the ETFs mentioned above.

Care to share your thoughts on oil/energy at this juncture? I'm watching and waiting to get back into oil but I'm not exactly sure what I'm waiting for. The general outlook for oil is bad and appeared to get worse by going under 40.

Thanks, sure enjoy your blog

 

 

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