WHAT ARE WE LOOKING FOR?
Leaders among Canadian-listed equity exchange-traded funds (ETFS) this year.
Global stock markets have staged a sharp comeback after last year's market collapse, and ETFs are one way to play the rebound. ETFs are similar to mutual funds but trade like stocks. There are brokerage fees to pay when buying ETFs, but they can be low when dealing with a discount broker.
TODAY'S SEARCH
We screened the year-to-date returns to Thursday of all equity ETFs to rank the best performers. We excluded the Horizons BetaPro bull and bear leveraged ETFs, and ETFs that were launched this year.
WHAT DID WE FIND?
The top three performers were Claymore specialty ETFs.
Claymore BRIC ETF, which is invested in Brazil, Russia, India and China, rose to the top with a nearly 75-per-cent gain. Claymore S&P/TSX Global Mining ETF posted a 59-per-cent return.
And Claymore Oil Sands ETF, which is focused on oil sands plays, has risen 54 per cent. While this energy ETF has blasted ahead of the 36-per-cent return by the broader based iShares Energy ETF, the Claymore offering also took a bigger hit in last year's market downturn.
What is also interesting is the performance range among Canadian equity ETFs.
While the iShares CDN Large Cap 60 Index is the grand daddy of ETFs in Canada, and a big draw for many investors wanting exposure to the domestic market, its 31-per-cent return lags some of its peers.
The leader of this group is the Claymore Cdn Fundamental Index ETF, which has gained a more robust 41 per cent. Unlike the iShares Large Cap 60 - whose stocks are weighted by market capitalization - the 65 stocks in the Claymore ETF are chosen using metrics like cash dividends, free cash flow, sales and book value.
The top three stocks in the Claymore ETF are Teck Cominco Ltd., Royal Bank of Canada and Toronto-Dominion Bank. The top three in iShares Large Cap 60 are Royal Bank of Canada, Suncor Energy Inc. and Toronto-Dominion Bank.
"Over 80 per cent are the same firms, but just different weights," said Vlad Tasevski, analyst at Claymore Investments Inc. "By Oct. 31, the Claymore ETF was overweight financials by 15 per cent [compared with the iShares ETF], and underweight energy by 8.8 per cent and 5.6 per cent less in materials."
If the financials outperform, the Claymore ETF will do well, but if this sector does badly, it will underperform the iShares ETF, Mr. Tasevski said. "Also, our metrics would provide our portfolio with a lower price-to-earnings ratio and higher dividend yields versus the iShares ETF."
| Top 30 Equity ETFs so far this year | As of | |||||||||
| Oct. 31/09 | (Calendar year % returns) | |||||||||
| Assets | Latest | (Nov. 19) | ||||||||
| Name | Symbol | Equity Category | ($millions) | MER | YTD % | 2008 | 2007 | 2006 | 2005 | 2004 |
| Claymore BRIC | CBQ-T | Emerging Markets | 245.5 | 0.66 | 74.5 | -57.6 | 70.9 | |||
| Claymore S&P/TSX Gbl Mining | CMW-T | Precious Metals | 44.9 | 0.59 | 59.0 | -38.8 | ||||
| Claymore Oil Sands Sector | CLO-T | Natural Resources | 31.3 | 0.63 | 54.4 | -54.2 | 22.7 | |||
| iShares CDN SmallCap | XCS-T | Cdn Small or Mid Cap | 68.7 | 0.55 | 51.9 | -45.4 | ||||
| Claymore Global Mos. Adv Div | CYH-T | Cdn Small or Mid Cap | 30.8 | 0.64 | 42.5 | |||||
| iShares CDN Materials Sector | XMA-T | Natural Resources | 257.8 | 0.55 | 42.3 | -26.8 | 29.5 | 48.4 | ||
| iShares CDN Financial Sector | XFN-T | Financial Services | 827.6 | 0.55 | 42.1 | -35.8 | -1.3 | 21.2 | 23.2 | 19.1 |
| iShares CDN REIT Sector | XRE-T | Real Estate | 786.4 | 0.55 | 42.0 | -38.3 | -6.0 | 26.8 | 24.3 | 13.1 |
| Claymore Eq. Wt. Bank & Lifeco | CEW-T | Financial Services | 22.2 | 0.59 | 41.7 | -36.8 | ||||
| Claymore Cdn Fundamental | CRQ-T | Canadian | 72.4 | 0.60 | 41.4 | -31.6 | 7.3 | |||
| iShares CDN Value | XCV-T | Cdn Div. & Income | 38.3 | 0.50 | 39.8 | -34.0 | 5.8 | |||
| iShares CDN Completion | XMD-T | Canadian | 137.2 | 0.55 | 39.3 | -38.8 | 5.3 | 17.8 | 21.3 | 21.6 |
| iShares CDN Tech Sector | XIT-T | Science & Tech | 58.5 | 0.55 | 37.6 | -49.1 | 10.7 | 32.7 | -13.5 | 24.2 |
| iShares CDN Jantzi Social | XEN-T | Canadian | 20.4 | 0.50 | 37.2 | -35.5 | ||||
| iShares CDN Energy Sector | XEG-T | Nat. Resources | 826.5 | 0.55 | 36.0 | -35.9 | 10.6 | 4.0 | 60.6 | 29.5 |
| iShares CDN Income Trust Sector | XTR-T | Cdn Income Trust | 205.8 | 0.55 | 34.9 | -25.9 | 6.0 | -3.2 | ||
| iShares CDN Composite | XIC-T | Canadian | 796.8 | 0.25 | 32.3 | -33.0 | 9.5 | 18.9 | 27.0 | 13.6 |
| iShares CDN Dividend | XDV-T | Cdn Div. and Income | 462.5 | 0.50 | 31.4 | -30.9 | -0.8 | 15.5 | ||
| Claymore Dividend & Income | CDZ-T | Cdn Div. and Income | 89.6 | 0.64 | 30.7 | -30.4 | 6.3 | |||
| iShares CDN LargeCap 60 | XIU-T | Canadian | 9805.5 | 0.17 | 30.5 | -31.1 | 10.9 | 21.5 | 25.9 | 13.6 |
| Claymore US Fundamental | CLU-T | U.S. | 67.3 | 0.62 | 28.6 | -42.6 | -2.9 | |||
| Claymore S&P/TSX Pref Share | CPD-T | Cdn Div. & Income | 277.4 | 22.7 | -17.1 | |||||
| iShares CDN Growth | XCG-T | Canadian | 36.6 | 0.50 | 21.9 | -29.3 | 21.4 | |||
| iShares CDN S&P 500 | XSP-T | U.S. | 1150.9 | 0.15 | 20.9 | -40.3 | 3.2 | 15.5 | 3.5 | 2.3 |
| Claymore Global Agriculture | COW-T | Global | 30.0 | 0.61 | 20.7 | -27.3 | ||||
| iShares CDN Gold Sector | XGD-T | Precious Metals | 1087.9 | 0.55 | 19.7 | 1.0 | -4.5 | 40.8 | 21.7 | -8.9 |
| Claymore International | CIE-T | International | 80.4 | 0.62 | 18.9 | -30.8 | ||||
| iShares CDN Russell 2000 | XSU-T | U.S. Sm/Mid Cap | 34.8 | 0.35 | 16.9 | -38.8 | ||||
| iShares CDN MSCI EAFE | XIN-T | International | 939.3 | 0.15 | 14.6 | -40.6 | 1.9 | 16.7 | 12.2 | 9.8 |
| Claymore Global Real Estate | CGR-T | Real Estate | 29.8 | 0.72 | 10.2 | |||||
| S&P/TSX Total Return | 32.8 | -33.0 | 9.8 | 17.3 | 24.1 | 14.5 | ||||
| MSCI World ($ Cdn) | -26.1 | -7.1 | 20.6 | 6.6 | 7.3 | |||||
| S&P 500 Composite ($ Cdn) | 5.3 | -23.8 | -12.2 | 13.6 | -0.2 | 1.5 | ||||
| Source: Globe Investor |
© 2007 The Globe and Mail. All rights reserved.
