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Natural gas ETF gets some A/C relief

What are we looking for?

The biggest money makers and money losers among Canadian-listed exchange-traded funds in the second quarter.

The screen

We ranked the eight best and worst performers for the three months ended June 30. ETFs that can short or bet against a sector, and leveraged ETFs, which can amplify long and short bets on the market, were excluded.

What did we find?

A heat wave boosting returns for the quarter's star ETF.

The iShares Natural Gas Commodity ETF, which has struggled in recent times amid depressed commodity prices, gained a robust 17 per cent in the quarter to lead the money makers. Unlike stock-based ETFs battered by rocky markets, this commodity fund provides exposure to the Alberta natural gas market by investing in forward contracts.

"The gas market was up strongly in the second quarter as warm weather increased the amount of energy consumed by North American air conditioners," said Oliver McMahon, director of product management for iShares ETFs at BlackRock Canada.

The quarterly gain, however, wasn't enough to pull the ETF out of red ink this year. It ended the first six months with a 31-per-cent loss.

ETFs tracking real estate investment trusts continued to deliver returns for yield-hungry investors. As the resource-heavy Canadian stock market struggled, BMO Equal Weight REITs ETF and iShares S&P/TSX Capped REIT, respectively, rose 5 and 4.8 per cent.

The biggest loser was the iShares S&P/TSX Venture ETF, which tracks an index of mostly junior energy and mining stocks. It shed 24 per cent in the quarter, and is off almost 17 per cent for six months.

Shares of junior oil companies were hurt as the price of crude fell sharply amid a cooling global economy. BMO Junior Oil ETF lost 18 per cent in the quarter.

Other smaller-company names sold off as risk aversion took over among investors because of uncertainly from the euro zone debt crisis and concerns about slower growth in China. BMO S&P/TSX Equal Weight Global Base Metals ETF lost nearly 24 per cent, too.



FundSymbolCategoryMERAssets($ in mil.)3 mosto June 30/12YTDto June 30/12Calendar Year Returns 2011201020092008
Top 8
iShares Natural Gas Commodity IndexGAS-TMisc. - Commodity0.9257.316.96%-30.80%-39.78%-49.75%-61.33%
BMO Long Federal Bond Index ETFZFL-TCdn. Long Term Fixed Income0.2373.55.44%3.73%19.88%
BMO Global Infrastructure Index ETFZGI-TGlobal Equity0.6146.85.25%7.68%19.65%
BMO Equal Weight REITs Index ETFZRE-TReal Estate Equity0.62266.25.04%12.07%13.91%
iShares S&P/TSX Capped REIT IndexXRE-TReal Estate Equity0.551,488.64.83%9.11%20.82%21.84%53.25%-38.30%
PS L-Term Government Bnd ETFPGL-TCdn. Long Term Fixed Income0.25402.34.26%2.48%
iShares Glo Real Estate Idx CommonCGR-TReal Estate Equity0.7218.14.19%14.81%-3.13%13.11%11.79%
PS S&P 500 Low Vol (CAD Hedged) ETFULV-TU.S. EquityN/A7.53.41%
Bottom 8
iShares S&P/TSX Venture Index FundXVX-TCanadian Equity0.791.1-23.90%-16.67%
BMO S&P/TSX EW Gbl Base Metals ETFZMT-TNatural Resources Equity0.6247.0-23.56%-20.31%-32.88%42.81%
BMO Junior Gold Index ETFZJG-TPrecious Metals Equity0.6297.5-20.47%-20.06%-27.95%
iShares MSCI Brazil IndexXBZ-TMisc. - Geographic Equity0.7517.9-18.58%-9.88%-22.70%
BMO Junior Oil Index ETFZJO-TNatural Resources Equity0.6215.7-18.11%-12.17%-3.87%
BMO Energy Commodities Idx ETFZCE-TMiscellaneous - Commodity0.762.8-16.91%-10.09%
iShares S&P/TSX Cap Info Tech IdxXIT-TMiscellaneous - Sector Equity0.5524.4-15.03%-6.75%-20.48%4.12%52.44%-49.14%
iShares BRIC Index - Common ClCBQ-TEmerging Markets Equity0.66225.1-14.28%-3.52%-22.51%8.78%75.05%-57.64%
S&P/TSX Total Return-5.67%-1.53%-8.71%17.61%35.06%-33.00%
Source: Lipper

© 2007 The Globe and Mail. All rights reserved.

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