copper prices

Gold has dropped over 30% from its high near $1,800 U.S. an ounce in September 2012 to $1,228 today. That’s partly because the U.S. Federal Reserve has indicated that it is likely to scale back its bond-purchasing program, known as quantitative easing. Slowing down the growth in the money supply will reduce the likelihood of a sharp increase of future inflation. Since many investors buy gold as a hedge against inflation, its price has weakened. The best way for aggressive investors to invest in gold is to buy shares of companies with rising production that will give them steady cash flow even if gold prices fall further. Here is our assessment of one of the gold stocks we cover for Stock Pickers Digest....

ISHARES MSCI CHILE INVESTABLE MARKET INDEX FUND $51.39 (New York Exchange symbol ECH; buy or sell through brokers) is an ETF that aims to track the MSCI Chile Investable Market Index, which consists of stocks that are mainly traded on the Santiago Stock Exchange.

The fund’s top holdings are S.A.C.I. Falabella (retail), 9.2%; Empresas Copec SA (conglomerate), 8.5%; Enersis AS (electricity), 8.3%; Cencosud SA (retailer), 6.7%; Empresa Nacional de Electricidad (electricity), 5.9%; Banco Santander Chile (banking), 5.5%; LATAM Airlines SA, 5.1%; Empresas CMPC (pulp and paper), 4.4%; Banco de Chile, 4.2%; and Quimica y Minera de Chile (mining), 3.7%.

The fund’s industry breakdown is: Utilities, 24.4%; Financials, 17.9%; Consumer Staples, 13.3%; Materials, 11.2%; Consumer Discretionary, 10.9%; Energy, 8.5%; Industrials, 8.2%; Telecommunications, 3.0%; and Information Technology, 2.1%.
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MAPLE LEAF FOODS INC., $15.98, Toronto symbol MFI, rose 20% this week after the company announced that it plans to sell all of part of its 90.0% stake in Canada Bread (see below). Canada Bread is Canada’s second-largest producer of fresh and frozen baked goods, after Weston Bakery. It also makes pastas and sauces. Canada Bread supplies around a third of Maple Leaf’s sales. Maple Leaf’s stake in this business—currently worth $1.6 billion—is equal to 73% of Maple Leaf’s $2.2-billion market cap. The company would use the proceeds to fund a major restructuring of its meat-processing operations. This includes building new plants and eliminating unprofitable products. It’s also installing a new computer system that will give its managers more timely information. In addition, the cash would help Maple Leaf pay down its long-term debt of $1.3 billion....

We think conservative investors could hold up to 10% of their portfolios in foreign stocks. One way to do that is to buy carefully chosen exchange traded funds (ETFs) that have an overseas focus.

The best ETFs offer very low management fees and well-diversified, tax-efficient portfolios of highquality stocks.

Here are six international ETFs we like:

ISHARES MSCI JAPAN INDEX FUND $11.81 (New York Exchange symbol EWJ; buy or sell through brokers; us.ishares.com) is an exchange traded fund that tries to match the return of the Morgan Stanley Capital International (MSCI) Japan index.

The ETF’s top holdings include Toyota, 6.6%; Mitsubishi UFJ Financial, 3.1%; Sumitomo Mitsui Financial, 2.4%; Softbank Corp., 2.4%; Honda Motor, 2.3%; Mizuho Financial Group, 1.9%; Japan Tobacco, 1.5%; Takeda Pharmaceutical, 1.4%; Canon, 1.3%; and Hitachi, 1.2%.

The fund’s industry breakdown is as follows: Financials, 21.4%; Consumer Discretionary, 21.1%; Industrials, 19.6%; Information Technology, 9.6%; Consumer Staples, 6.3%; Materials, 6.2%; Health Care, 5.9%; Telecommunication Services, 5.1%; Utilities, 2.8%; and Energy, 1.2%.

iShares MSCI Japan Index Fund was launched on March 12, 1996....

GLOBAL X COPPER MINERS ETF $9.36 (New York symbol COPX; buy or sell through brokers; www.globalxfunds.com) tracks the Solactive Global Copper Miners Index, which includes 20 to 40 international companies that mine, refine or explore for copper. Germany-based Structured Solutions AG created this index.

Canadian firms make up 46.1% of the fund’s holdings. It also includes companies based in Australia (7.3%), Poland (4.3%), Peru (4.8%) and Mexico (4.4%). Global X Copper Miners ETF’s MER is 0.65%.

Its top 10 holdings are Capstone Mining at 5.5%; Freeport Copper, 5.7%; Vendanta Resources, 5.6%; Imperial Metals, 5.6%; Lundin Mining, 5.5%; Jiangxi Copper Company, 5.4%; First Quantum Minerals, 5.3%; Taseko Mines, 5.3%; Antofagasta plc, 5.2%; and Turquoise Hill Resources, 5.2%.
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Lundin Mining, $4.66, symbol LUN on Toronto (Shares outstanding: 584.2 million; Market cap: $2.7 billion; www.lundinmining.com), is a diversified Canadian base metal mining company with operations in Portugal, Sweden and Spain. It also has a project under development in the U.S. that will produce copper, zinc, lead and nickel. In addition, Lundin owns a 24% stake in the Tenke Fungurume copper/cobalt mine in the Democratic Republic of Congo, as well as 24% of Freeport Cobalt Oy, which owns a cobalt refinery in Kokkola, Finland. In the three months ended June 30, 2013, Lundin Mining’s revenue rose 2.3%, to $176.3 million from $172.3 million a year earlier (all figures except share price and market cap in U.S. dollars). Earnings per share fell sharply, to $0.03 from $0.08, as higher costs offset increased production....

GLOBAL X COPPER MINERS ETF $9.36 (New York symbol COPX; buy or sell through brokers; www.globalxfunds.com) tracks the Solactive Global Copper Miners Index, which includes 20 to 40 international companies that mine, refine or explore for copper. Germany-based Structured Solutions AG created this index.

Canadian firms make up 46.1% of the fund’s holdings....

TECK RESOURCES LTD., $25.11, Toronto symbol TCK.B, reported lower results this week due to weaker metallurgical coal and copper prices. Even so, the latest revenue and earnings beat the consensus forecasts. In the three months ended June 30, 2013, Teck’s earnings fell 50.5%, to $197 million, or $0.34 a share. These figures exclude unusual items, such as foreign exchange losses and asset writedowns. On this basis, the latest earnings beat the consensus estimate of $0.31 a share. A year earlier, Teck earned $398 million, or $0.68 a share. Revenue fell 16.0%, to $2.2 billion from $2.6 billion. Even with the decline, the latest figure also beat the consensus estimate of $2.1 billion....

ISHARES MSCI CHILE INVESTABLE MARKET INDEX FUND $56.48 (New York Exchange symbol ECH; buy or sell through brokers) is an ETF that aims to track the MSCI Chile Investable Market Index, which consists of stocks that are mainly traded on the Santiago Stock Exchange.

The fund’s top holdings are Enersis AS (electricity), 8.0%; Empresas Copec SA (conglomerate), 7.4%; Cencosud SA (retailer), 7.2%; S.A.C.I. Falabella (retail), 6.6%; Empresa Nacional de Electricidad (electricity), 6.2%; LATAM Airlines SA, 5.7%; Quimica y Minera de Chile (mining), 5.0%; Banco Santander Chile (banking), 4.4%; and Empresas CMPC (pulp and paper), 3.9%.

The fund’s industry breakdown is: Utilities, 24.8%; Financials, 17.2%; Consumer Staples, 13.6%; Materials, 12.6%; Industrials, 9.3%; Consumer Discretionary, 8.3%; Energy, 7.4%; Telecommunications, 3.2%; and Information Technology, 2.5%.
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GLOBAL X COPPER MINERS ETF $10.23 (New York symbol COPX; buy or sell through brokers; www.globalxfunds.com) tracks the Solactive Global Copper Miners Index, which includes between 20 and 40 international companies that mine, refine or explore for copper. Germanybased Structured Solutions AG created this index.

Canadian companies make up 48.3% of the fund’s holdings. It also includes companies based in Australia (7.2%), Poland (5.0%), Peru (5.7%) and Mexico (6.7%). Global X Copper Miners ETF’s MER is 0.65%.

Its top 10 holdings are Turquoise Hill Resources at 5.8%; Capstone Mining, 5.5%; Vendanta Resources, 5.5%; Freeport Copper, 5.1%; First Quantum Minerals, 5.1%; Taseko Mines, 5.0%; Cudeco Ltd., 5.0%; Lundin Mining, 4.9%; Antofagasta plc, 4.9%; and Jiangxi Copper Company, 4.8%.
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