Value & Cyclical ETFs Warm To Greenie

  • February 12, 2001
  • Loren Fleckenstein

The cyclical-focused exchange-traded funds
registered gains Monday as their components rallied ahead of Greenspan’s
Humprhey-Hawkins testimony. The strategy-focused ETFs showed continued strength
in mid-cap and value areas.

The S&P/BARRA SmallCap 600 Value
iShares
(
IJS |
Quote |
Chart |
News |
PowerRating) rose 3.0%, the S&P MidCap 600
(
IJR |
Quote |
Chart |
News |
PowerRating) 2.3%. 

The Cyclicals-Transportation SPDR
(
XLY |
Quote |
Chart |
News |
PowerRating)
added 2.8%, the Dow Jones Consumer Cyclicals iShares
(
IYC |
Quote |
Chart |
News |
PowerRating) 2.3%.

The tech area was a mixed bag. The
Wireless HOLDR
(
WMH |
Quote |
Chart |
News |
PowerRating) gained 5.0%, the Dow Jones Telecommunications iShares
(
IYZ |
Quote |
Chart |
News |
PowerRating)
2.5%, the Internet HOLDR
(
HHH |
Quote |
Chart |
News |
PowerRating) 2.2%, the Semiconductor HOLDR
(
SMH |
Quote |
Chart |
News |
PowerRating) 2.1%.

On the downside, the Software HOLDR
(
SWH |
Quote |
Chart |
News |
PowerRating)
lost 5.1%, the Internet Infrastructure HOLDR
(
IIH |
Quote |
Chart |
News |
PowerRating) 1.8%.

The top field of all charts in this
commentary uses a logarithmic price scale and displays a 50-day price average in
red. In the second field, a
blue relative strength line represents the displayed security’s price
performance relative to the S&P 500. The third field displays vertical daily
volume bars in black with a 50-day moving average in blue for volume.

Exchange-traded
funds combine traits
of stocks and mutual funds. Like mutual funds, an ETF represents diversified
ownership in a number of different stocks, greatly reducing company-specific
risk. Like stocks, ETFs trade on exchanges, nearly all of them in fact trade on
the American Stock Exchange at present. They quote throughout the day, enabling
traders to take advantage of intraday price moves.

If you’re new exchange-traded funds,
be sure to visit TradingMarkets’ Knowledge Center,
dedicated to explaining the basics of trading and active investing in ETFs and
mutual funds. Just click on the Funds tab
near the top of this page, then click on the Knowledge
Center tab. 

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