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Metals, emerging market sectors help heat up ETF returns

What are we looking for?

The top Canadian-listed exchange-traded funds in the third-quarter. These short-term return numbers can be useful if you are an active ETF trader.

The search

We screened for the winning ETFs from July 1 to Sept. 30. Leveraged bull and bear ETFs were excluded.

What did we find?

Metals, agriculture, real estate and emerging markets were among the hot sectors.

BMO S&P/TSX Equal Weight Global Base Metals ETF emerged at the top of the heap with a 31.8-per-cent gain. "Base metals prices as well as gold have been on a run this year," said Kevin Gopaul, chief investment officer of BMO ETFs at Bank of Montreal.

Rising commodity prices have helped this ETF, which is focuses mostly on copper and aluminum-producing companies. Big gainers included stocks like Ivanhoe Mines Ltd., which rose 75 per cent over three months, and Lundin Mining Corp., up 72 per cent.

Copper prices climbed about 25 per cent and aluminum prices by 22 per cent in U.S. dollars, but the falling greenback did not hurt the fund because the currency exposure is hedged, Mr. Gopaul added.

BMO Junior Gold Index ETF was the third-best performer with a 22.1-per-cent gain as the price of gold hit new highs. The big movers included Guyana Goldfields Inc., which jumped 50 per cent, and Centerra Gold Inc., which rose 42 per cent.

"Because small-cap companies often carry more leverage on their balance sheets, their performance is more sensitive to the return of the underlying commodity," Mr. Gopaul said.

Claymore Global Agriculture ETF, which posted a 22.6-per-cent return, has benefited from the takeover battle for Potash Corp. of Saskatchewan after Australia's BHP Billiton Ltd. made a hostile bid.

Potash Corp., which had an average weight of 7.5 per cent in the ETF during the quarter, was the biggest contributor with a 61-per-cent return, said Vlad Tasevski, analyst at Claymore Investments Inc.

Other big gainers included CNH Global N.V., Mosaic Co., Sociedad Quimica y Minera de Chile SA and Deere & Co.



% returns to Sep. 30LatestAs of Sep. 30
NameSymbol3-mo YTD1-yr2-yr3-yr5-yrMERAssets ($ mil)Category
BMO S&P/TSX EW Gbl Base Metals ETFZMT-T31.769.29N/AN/AN/AN/A0.5843.8Natural Res. Equity
Claymore Global Agriculture ETFCOW-T22.624.5515.266.32N/AN/A0.61210.8Misc. - Sector Equity
BMO Junior Gold Index ETFZJG-T22.05N/AN/AN/AN/AN/A0.5859.7Precious Metals Equity
Claymore Broad Emerging Markets ETFCWO-T19.138.0815.61N/AN/AN/A0.4667.4Emerging Mkts Equity
iShares S&P/TSX Cap Materials IndexXMA-T18.0919.0526.2618.006.29N/A0.55267.1Natural Res. Equity
Claymore BRIC ETFCBQ-T18.093.7413.779.35-3.99N/A0.66315.7Emerging Mkts Equity
BMO Equal Weight REITs Index ETFZRE-T17.84N/AN/AN/AN/AN/A0.5828.1Real Estate Equity
iShares S&P/TSX Capped REIT IndexXRE-T17.8323.8932.6214.902.307.670.551076.9Real Estate Equity
Claymore S&P/TSX Global Mining ETFCMW-T17.097.2218.5218.02-0.54N/A0.5954.6Precious Metals Equity
iShares MSCI Emerging Markets IndexXEM-T15.776.1011.25N/AN/AN/A0.1171.1Emerging Markets Equity
iShares S&P CNX Nifty India IndexXID-T14.99N/AN/AN/AN/AN/A0.9810.9Misc. - Geographic Equity
Claymore Global Monthly Adv Div ETFCYH-T14.725.2312.193.18N/AN/A0.6471.6Cdn Sml/Mid Cap Equity
BMO Junior Oil Index ETFZJO-T14.68N/AN/AN/AN/AN/A0.583.4Natural Res. Equity
BMO Emerging Markets Equity ETFZEM-T14.687.70N/AN/AN/AN/A0.5715.4Emerging Mkts Equity
BMO China Equity Hedged ETFZCH-T14.35N/AN/AN/AN/AN/A0.718.9Greater China Equity
S&P/TSX Total Return10.267.4611.605.91-1.355.19
S&P 500 Composite ($ Cdn)4.30-2.300.60-3.96-9.16-4.39
Source: Globe Investor

© 2007 The Globe and Mail. All rights reserved.

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