etf

One of the ways a company can try to unlock its own hidden value is by creating a separate company out of a subsidiary. The parent company can either sell stock in the new company to the public, or spin it off—hand the stock out to its own investors. In the past few years, it has become common to do both. The parent company starts by selling a portion of the new company to the public, to establish a market and a following among investors. That way, by the time of the spin-off, stock in the new company may be liquid enough to be sold relatively easily, or retained with some confidence as a worthwhile investment. In our experience, and in most academic studies of the subject, this helps the parent and the spin-off. Both generally do better than comparable companies for at least several years after the spin-off takes place....

The Guggenheim Spin-off ETF, $46.50, symbol CSD on New York (Units outstanding: 13.3 million; Market cap: $618.5 million; www.guggenheiminvestments.com), aims to track the Beacon Spin-off Index. The ETF’s MER is 0.65%. The Beacon Spin-off Index consists of 34 stocks. Companies can be included if they have been spun off in the past 30 months. There are no limitations on market capitalization (or the total value of a company’s outstanding shares), but companies in the index are mainly small- and mid-caps with capitalizations under $10 billion. Beacon defines a spinoff as any firm resulting from either of the following events: a parent company’s distribution of shares in a subsidiary to its own shareholders or “partial initial public offerings,” in which a parent company sells a percentage of a subsidiary’s shares to the general public....

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’s a look at six global ETFs:...

ISHARES CDN REIT SECTOR INDEX FUND $16.64 (Toronto symbol XRE; buy or sell through brokers; ca.ishares.com) holds the 15 Canadian real estate investment trusts in the S&P/TSX Capped REIT Index. iShares CDN REIT’s expenses are 0.60% of its assets. The fund yields 5.0%. The ETF’s largest holding is RioCan REIT at 19.3%, followed by H&R REIT (14.7%), Canadian REIT (7.8%), Dream Office REIT (7.0%), Calloway REIT (6.4%), Boardwalk REIT (6.3%), Canadian Apartment REIT (6.2%), Allied Properties REIT (5.8%), Cominar REIT (5.4%), Artis REIT (5.0%), Chartwell REIT (4.6%), Granite REIT (4.5%), Crombie REIT (2.4%), Northern Property REIT (2.2%) and Dream Global REIT (2.1%)....

ISHARES S&P INDIA NIFTY 50 INDEX FUND $30.98 (Nasdaq symbol INDY; buy or sell through brokers; us.ishares.com) is an ETF that aims to invest in the 50 largest, most liquid Indian securities. Indian stocks have moved up steadily since the May 2014 election of Narendra Modi as prime minister. India still needs to modernize its transportation,communications and electrical infrastructure. It also needs to reform its inefficient, corrupt bureaucracy....

ISHARES AUSTRALIA INDEX FUND $27.34 (New York symbol EWA; buy or sell through brokers) is an ETF that holds the 72 largest Australian stocks. Its MER is 0.48%. The fund’s top holdings include Commonwealth Bank of Australia, 11.1%; BHP Billiton, 10.0%; Westpac Banking Corp., 9.2%; Australia and New Zealand Banking Group, 7.8%; National Australia Bank, 6.9%; Wesfarmers, 4.3%; Woolworths, 3.9%; CSL Ltd., 3.1%; Woodside Petroleum, 2.4%; Rio Tinto, 2.3%; Telstra Group, 2.0%, Macquarie Group, 1.4%; and Westfield Group, 1.3%. Australia benefits from its stable banking and political systems. It is also rich in natural resources and close to key Asian markets with vast potential, including India and China....

MARKET VECTORS VIETNAM ETF $21.48 (New York symbol VNM; buy or sell through brokers) holds shares of Vietnamese companies or foreign firms that get a significant amount of their revenue from Vietnam.

The ETF’s top holdings are Saigon Thuong Tin Commercial Bank, 7.8%; Bank for Foreign Trade of Vietnam, 7.4%; Masan Group (food, resources and banking conglomerate), 7.3%; Vincom Corp. (real estate), 6.3%; PetroVietnam Fertilizer & Chemical, 5.7%; Baoviet Holdings (finance and insurance), 5.6%; and PetroVietnam Technical Services (oilfield services), 5.4%.

Market Vectors Vietnam ETF’s industry breakdown is as follows: Financials, 35.8%; Energy, 23.4%; Industrials, 12.6%; Consumer Staples, 11.6%; Consumer Discretionary, 8.3%; Materials, 5.7%; and Utilities, 1.3%. Its expense ratio is 0.72%.

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Every Wednesday, we publish our “Investor Toolkit” series on TSI Network. Whether you’re a new or experienced investor, these weekly updates are designed to give you specific investment advice on a wide range of topics, including strategies for international stock markets. Each Investor Toolkit update gives you a fundamental piece of investing strategy, and shows you how you can put it into practice right away. Today’s tip: “Foreign investments can give your portfolio greater strength and diversity and we recommend three ways you can do this with less risk.” We believe most investors could benefit from holding some foreign investments in their portfolios for added diversification. And growing markets like China and India have positive long-term outlooks. Their populations are generally younger than those in North America, and rising incomes are helping more of them advance into the middle class....

Technology Select Sector SPDR Fund ETF, $38.74, symbol XLK on New York (Units outstanding: 340.3 million; Market cap: $13.2 billion; www.spdrs.com), aims to track the S&P Technology Select Sector Index, which consists of tech stocks in the S&P 500 Index. The fund’s MER is just 0.16%. The $13.6-billion fund’s top 10 holdings are Apple, Google, Microsoft, Verizon, IBM, Cisco Systems, Intel, AT&T, Oracle and Qualcomm. The ETF is broken down by segment as follows: technology, hardware, storage and peripherals, 20.6%; software, 16.6%, information technology services, 15.8%; Internet software and services, 15.1%; diversified telecommunication services, 11.4%; semiconductors and semiconductor equipment, 10.4%; communications equipment, 8.0%; and electronic equipment, instruments and components, 2.1%....

ISHARES FTSE/XINHUA CHINA 25 INDEX FUND $40.21 (New York symbol FXI; buy or sell through brokers) is an exchange traded fund that aims to track the FTSE/Xinhua China 25 Index, which is made up of the 25 largest, most liquid Chinese stocks. All of the stocks in the index trade on the Hong Kong exchange. Some also trade as American Depositary Receipts (ADRs) on New York. The fund’s top holdings are Tencent Holdings, 10.2%; China Construction Bank, 8.4%; China Mobile, 8.3%; Industrial & Commercial Bank, 6.9%; Bank of China, 5.4%; China Overseas Land & Investment, 4.3%; China Life, 4.0%; Ping An Insurance, 4.0%; China Shenhua Energy, 3.9%; PetroChina, 4.2%; China Merchants Bank, 3.7%; and CNOOC Ltd., 3.7%. The fund’s holdings give it the following industry breakdown: Financials, 54.1%; Telecommunications, 14.4%; Oil and Gas, 12.1%; Technology, 10.1%; Basic Materials, 4.0%; Industrials, 1.8%; and Consumer Goods, 1.7%. Its expense ratio is 0.73%....