REMX, the Rare earths ETF is shining, far outpaces gold

REMX is the rare earth ETFs. With China controlling most of the global production, rare earths have been pumped up quite a bit lately. They are in the same level of Lithium (due to electric cars), except that there are vast supplies of Lithium (please take a look at SQM, the great Chilean company).

REMX started trading in late October 2010. Since then, it is up 23%.

In particular, REMX has outpaced gold since inception, in spite of the near record prices for gold:

REMX is a Van Eck Global ETF.

• Gross Expense Ratio: 0.63%
• Net Expense Ratio: 0.57%

Top holdings:

Van Eck says: Rare earth/strategic metals are industrial metals that are typically mined as by-products in operations focused on precious metals and base metals. Compared to base metals, they have more specialized uses and are often more difficult to extract. Currently, approximately 49 elements in the periodic table are considered rare earth/strategic metals. They include such elements as cerium, manganese, titanium and tungsten. Strategic metals are used in a variety of technologies including jet engines, hybrid cars, steel alloys, wind turbines, flat screen televisions and cellular phones. Rare earth metals, a subset of strategic metals, are a collection of 17 chemical elements that are essential in many of today’s most advanced technologies, with particular applications in electronics.

Oil soars: straddles return +142%

We posted these just 2 days ago. While gold did not move that much, oil certainly did.

These were computed with the StraddlesCalc tool. The beauty of straddles is that the investor can benefit whether the stick moves up or down.

With Saudi Arabia in talks to boost oil production, oil will continue to be volatile and may drop significantly, or rise further, just perfect for straddles.

Remember Chile After the Earthquake? New Zealand's earthquake and ETF

New Zealand suffered a devastating earthquake today, very sadly with tens of people killed and massive property losses. As a result as well, the New Zealand dollar and stocks have dropped significantly.

While the damage still needs top be assessed, in general, these stock losses are not justified. The example is Chile, which also suffered a devastating earthquake in February of last year. ECH is the ETF for Chile.

Since just after the earthquake until the peak, ECH rose over 40%. Earthquakes provide massive government stimulus to the economy.

The ETF for New Zealand is ENZL. It is down about 4 % today:

It's MER is an attractive 0.55%.

Top holdings and sectors:

ENZL is currently trading at $28.42.

Silver is skyrocketing on troubles in Mideast: Miners ETFs

Please see the the price of silver today:

That is a big jump to almost $34. f silver leads gold, then all miners will life when the markets open (silver)

We track all miner ETFs live here.

ETFs for the new currency wars: Brazil vetos G20, Canadian dollar new high

Brazil has just announced that it will veto France's proposal for currency controls at the G20. France basically is happy to see the Euro devalued while emerging nations currencies, about the only coutnries who can buy something these days, continue to rise.

In the meantime, the Canadian dollar continues to rise, hitting fresh highs. The ETF is FXC:

We track all currency ETFs live here. Please see the returns since 2009. +42% for the Aussie dollar ETF, +34% for the Brazilian Real ETF, +22% for the Canadian ETF

Huge drawdown in natural gas: UNG attractive for March

The latest natural gas storage figures showed a massive drawdown of 233Bcf. These is the latest chart, note how the lower 5-year average channel is about to be pierced:

 The dreadful UNG responded in kind, as bizarre as ever:

March 5 calls are going for 0.32, very attractive at this point (in spite of the underlying ETF)!)

However, note that there is still contango, and please do read the alternative here.

Forget UNG: A much better ETF to play a natural gas rebound

As we have been reporting, contango is back in full force with its usual dire effects on UNG. For investors, who think that natural gas prices will rebound at some point, there are much better ways to invest using ETF.

Please take a look at the charts of FCG versus UNG:

1-year:

 

In this period, UNG is down over 45%, while FCG is up over 17%.

3- years:

In this longer time frame, UNG is down a staggering 90%, while FCG is up 7.50%.


So what is FCG? It is the First Trust natural gas companies ETF. These are the top holdings, and percentages:

SandRidge Energy, Inc.	4.12
Chesapeake Energy Corporation	4.00
Cimarex Energy Co.	3.73
Devon Energy Corporation	3.59
SM Energy Co.	3.55
Suncor Energy, Inc.	3.52
Range Resources Corporation	3.44
Stone Energy Corporation	3.43
Exxon Mobil Corporation	3.43
EOG Resources, Inc.	3.41

The First Trust ISE-Revere Natural Gas Index Fund is an exchange-traded fund. The investment objective of the Fund is to seek investment results that correspond generally to the price and yield, before fees and expenses, of an equity index called the ISE-Revere Natural Gas IndexTM

The ISE-Revere Natural Gas IndexTM is an equal-weighted index comprised of exchange-listed companies that derive a substantial portion of their revenues from the exploration and production of natural gas. The Index is constructed by establishing the total population of stocks listed in the U.S. of companies involved in the exploration and production of natural gas and then eliminates stocks whose natural gas proved reserves do not meet certain requirements. From this universe, all candidate stocks are ranked using four different methods including Price/Earnings ratio, Price/Book ratio, Return on Equity and the correlation to gas futures prices. To meet index eligibility, a stock must also satisfy market capitalization, liquidity and weighting concentration requirements. Then rankings are then averaged and the top 30 stocks based on final rank are selected for the Index. The Index is rebalanced on the application of the above model on a quarterly basis.

Poor UNG suffers again: natural gas contango is in full force

Readers here know about the correlation between contango and UNG. UNG suffers because it needs to swap its contracst every month, so contango is a silent destoryer of wealth.

The effects are clear in the last 3 weeks:

The news is very bad for UNG holders. These are the current rpices:

April prices are 1.42% higher than March's. Buyer beware!