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ETFs: top earners and bleeders of the year


The stars and dogs among Canadian-listed exchanged-traded funds this year.

ETFs, which are mutual funds that trade like stocks, have grown in popularity thanks to their low fees and ease of buying and selling.

With the world's major stock markets in the red, it's interesting to see what kinds of ETFs are making money, and which are bleeding badly.


We checked the year-to-date returns to Aug. 14 of all ETFs listed in Canada to find the 10 best and 10 worst performers.

Barclays Global Investors' iShares ETFs mimic mainly traditional and also specialty indexes. Claymore Investments focuses on specialty indexes. And BetaPro Management has the Horizons BetaPro bull and bear ETFs, respectively offering double the daily gain and double the daily loss of the indexes or commodities that they track.


The iShares Canadian Income Trust Sector ETF was the top performer with a 15.2-per-cent gain to Aug. 14. It is also the leader among all Canadian income trust equity funds.

This iShares ETF, which includes 60 trusts, benefited from the surging energy sector earlier this year; robust distributions of some of its members and takeovers. Canadian Oil Sands Trust, Penn West Energy Trust and Fording Canadian Coal Trust make up 30 per cent of this ETF. Fording, which is being acquired by Teck Cominco Ltd., has gained a whopping 149 per cent.

The HBP S&P/TSX Financials Bear + ETF, which effectively allows investors to sell short stocks in this sector, has risen 12.4 per cent. This ETF has made money as Canadian banks and other financials have been hit by the fallout emanating from the U.S. subprime mortgage mess.

And bond ETFs, which might seem boring compared to the potential of their equity peers, made up six of the top performers. The iShares Canadian Real Return Bond ETF was the leader with a 10.3-per-cent gain.

Among the dogs, the HBP S&P/TSX Global Gold Bull + ETF has plunged 35.3 per cent as gold stocks have headed south along with the price of the yellow metal.

The Claymore BRIC ETF, which invests in Brazil, Russia, India and China, was on a hot streak last year, but that's no longer the case. This ETF has plunged 21.3 per cent as stock markets, especially India and China, have taken a sharp tumble amid a global market meltdown.

While Brazil's Bovespa index was the best performer earlier this year among the major markets, it began losing steam in late May on falling commodity prices and concerns about rising interest rates.

Top and bottom Canadian ETFs

Fund nameCategory(as of July '08) Assets ($-mil)Latest MERAs of Aug. 14 % return YTD% return (as of July 31 '08): 1 yr% return (as of July 31 '08): 3-yr% return (as of July 31 '08): 5 yr% annual return 2007% annual return 2006% annual return 2005% annual return 2004% annual return 2003
Top 10 Canadian ETFs
iShares CDN Income Trust Sector IdxCdn. Income Trust Equity151.70.5515.213.76.0-3.2
HBP S&P/TSX Financials Bear + ETFAlternative Strategies12.416.1
iShares CDN Real Return Bond IndexCdn. Inflation Protected Fxd Inc.125.40.3510.313.41.2-2.8
iShares CDN Energy Sector IndexNatural Resources Equity595.30.558.610.112.325.410.64.060.629.524.2
HBP S&P/TSX Energy Bull + ETFAlternative Strategies7.57.1
iShares CDN Short Bond IndexCdn. Short Term Fixed Income750.
iShares CDN Government Bond IndexCanadian Fixed Income40.40.353.88.24.1
iShares CDN Bond IndexCanadian Fixed Income940.
iShares CDN Corporate Bond IndexCanadian Fixed Income156.60.402.64.81.2
iShares CDN Long Term Bond IndexCdn. Long Term Fixed Income42.60.351.77.12.9
Bottom 10 Canadian ETFs
HBP S&P/TSX Global Gold Bull + ETFAlternative Strategies-35.3-2.4
HBP S&P/TSX Energy Bear + ETFAlternative Strategies-27.5-28.4
HBP S&P/TSX Financials Bull + ETFAlternative Strategies-24.2-27.7
Claymore BRIC ETFEmerging Markets Equity179.8-21.316.570.9
iShares CDN MSCI EAFE IndexInternational Equity734.30.15-19.0-
Claymore US Fundamental Index ETFU.S. Equity19.60.65-14.8-19.6-2.9
iShares CDN Gold Sector IndexPrecious Metals Equity909.30.55-
Claymore International Index ETFInternational Equity29.8-12.4-15.4
iShares CDN SmallCap IndexCdn. Small or Mid Cap Equity27.50.55-11.0-16.9
iShares CDN S&P 500 IndexU.S. Equity541.70.15-11.0-


© 2007 The Globe and Mail. All rights reserved.

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