Top ETFs of the Week (GDX, EPOL, NUGT, URA)
The top ETFs in several categories this week are listed below.
Sector ETF – Market Vectors Gold Miners ETF (NYSE: GDX)
The ETF closed out the week with a gain of 8.0 percent and is trading at the best level in a month. This has not been a good year for the gold miners, but the recent pattern suggests there could be more short-term upside for the ETF.
Longer-term the severe downtrend remains intact and the ETF is a gamble as investors would be fighting the trend. A major reason for the big move this week was a 24 percent gain from the number 11 holding, Agnico-Eagle Mines (NYSE: AEM).
Country ETF – iShares MSCI Poland ETF (NYSE: EPOL)
The ETF closed at a new two-year high after gaining 3.8 percent this week. The last few months have been good to the ETF after a rough start to the year.
A six-month downtrend was broken in July and after a big move to new highs, the ETF is up eight percent in 2013. The risk remains high for investors in Poland and the longer-term trend on the ETF is not overly attractive. There are better options in the emerging market arena.
Leveraged ETF – Direxion Daily Gold Miners Bull 3x ETF (NYSE: NUGT)
The big move in the mining stocks sent this extremely risky ETF up 23.9 percent on the week. To put this into perspective, the ETF is still down 90 percent in 2013 after the big really the last week. Similar to GDX, the move this week was based on a rising price for gold and a big breakout by AEM.
Any leveraged ETF is capable of a big week when the tide is moving in their favor, at the same time an investor can have the waves crash on them if they are on the wrong side of the trade.
For example, the Direxion Daily Gold Miners Bear 3x ETF (NYSE: JDST) lost 33 percent this week because it is a bet on the small-cap gold miners falling and that was not the case. Investors, beware!
Niche ETF – Global X Uranium ETF (NYSE: URA)
A six percent rally on Friday made up the majority of the 6.3 percent weekly gain for the uranium ETF. This is a tough one to figure out because the top stocks in the ETF did not make the big moves to account for a six percent gain on Friday, but the action was confirmed through several sources.
The one very interesting difference on Friday was the volume for URA, which was eight times more than the average daily volume for the ETF. The ETF is worth watching, but do not jump into this bizarre situation at this time.
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