Five ETF Rivalries to Watch in 2012

Avid fans and observers of the exchange-traded products industry know that there are plenty of ETFs from issuer A that do the same thing as a fund from issuer B. The proliferation of so many “me too” ETFs means there are some neat ETF rivalries to watch.

And when it comes to those rivalries, some are known while others fly under the radar. The competition between the Vanguard MSCI Emerging Markets ETF (NYSE: VWO) and the iShares MSCI Emerging Markets Index Fund (NYSE: EEM is obvious as is the tussle between the SPDR Gold Shares and the iShares Gold Trust (NYSE: IAU).

Those examples aside, let's look at five ETF rivalries that will be of interest to investors in 2012.

Oil Rivalry The iShares Dow Jones US Oil Equipment Index Fund (NYSE: IEZ) and the Oil Services HOLDRs (AMEX: OIH) represent one of the more compelling ETF rivalries at the sector level and this rivalry should be all the more interesting next year as OIH becomes a Market Vectors ETF. Given the sector these ETFs track, we'll call this Texas vs. Texas A&M.

Who Will Shine With Silver? Silver miners that is. Since its debut in April 2010, the Global X Silver Miners ETF (NYSE: SIL) has had the market on silver miners ETFs cornered because it has been the only ETF tracking some of these stocks. SIL won't be lonely much longer as iShares has filed plans for its own silver miners ETF. Of course, there's no guarantee the iShares fund will ever come to market, and even it does, SIL's first-to-market advantage cannot be underestimated.

Beep Beep. The First Trust NASDAQ Global Auto Index (Nasdaq: CARZ) and the Global X Auto ETF (NYSE: VROM) both came to market this year with CARZ beating VROM out of the gate by about a week. However, VROM has $4.5 million in assets under management compared to $3.3 million for CARZ. Assuming the economy, namely the jobs picture, improves, this could turn out to be a nifty ETF battle. Given the sector, we'll call this Michigan vs. Michigan State.

Going With Gold Next year, the Market Vectors Gold Miners ETF (NYSE: GDX) will celebrate its sixth birthday. It should also celebrate the fact that its dominance among ETFs tracking large-cap gold miners has led to AUM haul over $9.2 billion. Like SIL, GDX might be getting a rival in the form of an iShares gold miners ETF that the firm has filed plans for. GDX has a first-to-market advantage that has endured a couple of challengers to date. Will that trend continue against iShares? We'll call this the Gold Cup.

Battle For Nigeria While there isn't a Nigeria-specific ETF on the market today, both Van Eck, parent company of Market Vectors, and Global X have filed plans to bring Nigeria ETFs to market. We're working on the premise that neither will come to market this and both will debut next year. To be clear, we do not know when either will debut.

Given that both funds are likely to be heavy on energy names, this battle could come down to which ETF has the lower expense ratio, particularly if both ETFs come to market in a condensed period of time as CARZ and VROM did.