S&P Capital IQ Highlights 3 Contrarian ETFs (IEZ, VWO, VOT)

April showers didn't give way to many May flowers for U.S. stocks and ETFs. After Friday's action, it's safe to say traders and investor might be in for some June gloom as well. Quips about the months aside, the path of least resistance for riskier assets is down, at least for the foreseeable future. These are trying times indeed, but contrarian investing has often proven rewarding over time

. S&P Capital IQ runs a contrarian ETF portfolio that holds eight ETFs. The portfolio was up 11.2% through the end of April and has outperformed its benchmark index by 150 points since its October 2009 inception. Earlier this week, the research firm made some new additions to the portfolio that certainly fit the bill as contrarian given the current market environment. Despite the substantial declines experienced by almost every emerging markets ETF under the sun over the past several weeks, S&P Capital IQ added the Vanguard MSCI Emerging Markets ETF

to its contrarian portfolio. VWO, which had almost $54 billion in assets under management at the end of April, is the largest emerging markets ETF on the market today. S&P rates VWO Marketweigtht. The fund, which has lost more than 13% in the past month, is heavily allocated to Chinese, South Korean, Brazilian and Taiwanese equities, among others. The Vanguard Mid-Cap Growth ETF

was also added to the portfolio. VOT, which is also rated Marketweight by S&P, has an expense ratio of just 0.1%, making it cheaper than 93% of comparable funds, according to Vanguard. Consumer discretionary and technology names account for 42.5% of VOT's weight while health care and industrials combine for another 29.3%. The fund has lost 11.3% in the past month. Perhaps the most contrarian addition of the three is the iShares Dow Jones US Oil Equipment Index Fund

, which S&P also rates Marketweight. Since the start of May, West Texas Intermediate crude has lost about 20%, including a 17% drop last month. Over the same time, the iShares Dow Jones US Oil Equipment Index Fund has slipped almost 16%. "A look under the hood of IEZ reveals that the ETF ranks favorably in the performance-ranking category, but receives a neutral assessment of its cost factors. In the risk considerations category, S&P Capital IQ determined the ETF ranks unfavorably" S&P said in a research note. "IEZ tracks the performance of the Dow Jones US Select Oil Equipment & Services Index, which is focused on oil industries. While the ETF's ranking is hurt by its elevated volatility, analyst Todd Rosenbluth pointed to the potentially favorable characteristics of the underlying holdings. Five-STARS-ranked Schlumberger

is the ETF's top holding and six other stocks within the top-10 holdings are considered attractive by S&P Capital IQ equity analysts." Schlumberger, the world's largest oilfield services provider, currently accounts for nearly 20.5% of IEZ's weight. Other top-10 holdings include National Oilwell Varco

, Halliburton (NYSE HAL) and Baker Hughes

. Other members of the S&P contrarian portfolio include the iShares Dow Jones International Select Dividend Index Fund

, the First Trust Health Care AlphaDEX Fund

and the PowerShares S&P 500 High Quality ETF

.