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Precious metals ETFs at head of the class

swon@globeandmail.com

What are we looking for?

Stars among Canadian-listed exchange-traded funds (ETFs) this year.

The screen

We screened for the 15 best-performing ETFs from Jan. 1 to Dec. 8. This does not preclude ETFs with shorter-term track records from emerging with better returns. Leveraged ETFs were excluded.

What did we find?

Precious metals investments with glittering returns led by HBP COMEX Silver ETF.

This ETF climbed nearly 62 per cent, and outpaced its peers by a wide margin. The nearest rival was iShares S&P/TSX Capped Materials ETF with a 32.4-per-cent gain, helped by its precious metals stocks that make up seven of its top 10 holdings.

HBP COMEX Silver ETF tracks silver futures on the COMEX division of the New York Mercantile Exchange, and hedges the U.S. currency back to Canadian dollars. It's the only silver ETF play in Canada as the TSX-listed silver bullion offerings are all closed-end funds.

While the price of silver has outpaced gold bullion this year, assorted gold-based ETFs have not been slouches either. The yellow-metal ETFs, whether invested in stocks, bullion or tracking gold futures, were among the 15 top performers, but their returns did not vary widely.

The iShares S&P/TSX Global Gold ETF, whose holdings in Barrick Gold Corp., Goldcorp Inc. and Newmont Mining Corp. make up 41 per cent of its assets, was up nearly 27 per cent. Claymore Gold Bullion ETF and also HBP Comex Gold ETF, which tracks gold futures, each rose 24 per cent. The pair are also hedged back to Canadian dollars.

The performance gap has narrowed between larger gold company stocks and bullion because of the "strong bullish sentiment for the commodity," said Vlad Tasevski, analyst at Claymore Investments Inc.

Gold and silver bullion have become a safe haven for some investors seeking to protect themselves from a debasing of currencies and inflation risk. Speculation has also helped drive up the metal prices.

Still, the biggest mover among the Canadian-listed gold ETFS has been BMO Junior Gold (ZIG-TSX) as small- to mid-cap gold stocks have outperformed the gold price and large-cap miners. This ETF, which was launched Jan. 19, posted a more robust 57-per-cent gain to Dec. 8.

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TOP PERFORMING NON-LEVERAGED CANADIAN ETFS THIS YEAR

YTD % rtnYTD % rtn% rtn ($-mil)
ETF nameSYMBOLDec. 8Nov. 3020092008200720062005MERASSETSCATEGORY
HBP COMEX Silver ETFHUZ-T61.961.7N/AN/AN/AN/AN/A0.925.0Alt. Strategies
BMO S&P/TSX EW Gbl Base Metals ETFZMT-T33.123.6N/AN/AN/AN/AN/A0.5847.5Natural Res. Eq.
iShares S&P/TSX Cap Materials IndexXMA-T32.430.033.5-26.829.548.4N/A0.55289.2Natural Res. Eq.
iShares S&P/TSX SmallCap IndexXCS-T29.025.961.1-45.4N/AN/AN/A0.55136.9Cdn Sml/Md Cap Eq.
iShares S&P/TSX Completion IndexXMD-T27.024.146.4-38.85.317.821.30.55192.6Cdn Sml/Md Cap Eq.
iShares S&P/TSX Global Gold IndexXGD-T26.825.77.01.0-4.540.821.70.551,270.6Precious Metals Eq.
Claymore Gold Bullion ETF CGL-T24.424.2N/AN/AN/AN/AN/A0.50474.7Miscellaneous - Other
HBP COMEX Gold ETFHUG-T23.523.8N/AN/AN/AN/AN/A0.8810.5Alt. Strategies
Claymore S&P/TSX Global Mining ETFCMW-T23.118.354.3-38.8N/AN/AN/A0.5958.0Precious Metals Eq.
iShares Russell 2000 Idx (CAD-Hgd)XSU-T22.116.024.5-38.8N/AN/AN/A0.3559.7U.S. Sml/Md Cap Eq.
iShares S&P/TSX Capped REIT IndexXRE-T19.320.453.2-38.3-6.026.824.30.551,092.6Real Estate Eq.
iShares Dow Jones Cda Sel Gwth IdxXCG-T15.714.122.2-29.321.4N/AN/A0.5035.7Canadian Eq.
iShares S&P/TSX Cap Composite IdxXIC-T14.512.734.4-33.09.518.927.00.251,125.7Canadian Eq.
Claymore S&P/TSX Cdn Dividend ETFCDZ-T14.112.838.2-30.46.3N/AN/A0.64333.7Cdn Div. & Incm Eq.
iShares Diversified Monthly IncomeXTR-T13.413.640.4-25.96.0-3.2N/A0.55221.1Cdn Incm Trust Eq.
S&P/TSX Total Return14.813.035.1-33.09.817.324.1
S&P 500 Composite ($ Cdn)N/A2.611.8-26.1-7.120.66.6
Source: Globe Investor

© 2007 The Globe and Mail. All rights reserved.

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