Columbia India Consumer ETF (ARCA:INCO), Trade Ideas

Columbia India Consumer ETF

Income Opportunity Realty Investors, Inc. Common Stock

Income Opportunity Realty Investors Inc

Incordex Corp

Some of this year&#39;s top asset-gathering exchange-traded funds are emerging markets funds, indicating investors are increasingly comfortable revisiting once disappointing developing markets equities. There are, however, additional data points that suggest investors are bullish on emerging markets stocks and ETFs.
In its most recent <a href="http://cts.businesswire.com/ct/CT?id=smartlink&amp;url=https%3A%2F%2Fwww.cmidintranet.com%2Fpublic%2Fpdf%2FEM_Investor_Sentiment_Survey_2Q17-Emerging_Markets.pdf&amp;esheet=51665476&amp;newsitemid=20170807005682&amp;lan=en-US&amp;anchor=Emerging+Markets+Investor+Sentiment+Survey&amp;index=1&amp;md5=ee36153944714eec546093424a7910ca">Emerging Markets Investor Sentiment Survey</a>, ETF issuer Columbia Threadneedle Investments notes investor sentiment toward emerging markets is overwhelmingly positive with the survey &ldquo;score of 850 out of 1000 indicates that investors clearly have a positive outlook for emerging markets over the next 12 months. In fact, sentiment is up 35 percent from Q4 2016 and 72 percent from Q4 2015,&rdquo; <a href="http://www.businesswire.com/news/home/20170807005682/en/Investor-Outlook-Emerging-Markets-Overwhelmingly-Positive-Columbia">according to a statement</a>.
Columbia Threadneedle issues some well-known emerging markets ETFs, including the Columbia Emerging Markets Consumer ETF (NYSE: <a class="ticker" href="/stock/econ#NYSE">ECON</a>) and the Columbia India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>), one of this year&#39;s best-performing single-country emerging markets funds.
<h3>Investors Are Bullish</h3>
Columbia Threadneedle&#39;s survey indicates asset allocators are increasingly bullish on emerging markets stocks, a view that makes sense with the MSCI Emerging Markets Index up more than 26 percent year to date, or more than double the almost 12 percent returned by the S&amp;P 500.
&ldquo;The majority (72 percent) of survey respondents have a positive outlook for emerging markets equities over the next 12 months, a significant shift both from Q4 2016 when 45 percent of respondents had a positive outlook and Q4 2015 when only 26 percent of respondents felt this way,&rdquo; said the fund issuer. &ldquo;One quarter of respondents have a neutral outlook and only 3 percent have a negative outlook for emerging markets in the next 12 months. As the sentiment among respondents has shifted, so have allocation expectations.&rdquo;
The firm&#39;s other ETFs include the India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scin#NYSE">SCIN</a>), which is up 42.4 percent year to date; and the Columbia EM Quality Dividend ETF (NYSE: <a class="ticker" href="/stock/hilo#NYSE">HILO</a>).
<h3>Not A Crowded Trade</h3>
A favored battle cry on Wall Street is that many hot trades are also crowded trades, but after years of investors ignoring emerging markets, it is fair to say this trade is far from crowded.
&ldquo;While current emerging markets allocation levels are between 1 and 10 percent (69 percent of respondents), advisors and investment professionals surveyed are trending toward higher allocations,&rdquo; said Columbia Threadneedle. &ldquo;For example, 36 percent of respondents have a higher EM allocation than they did 12 months ago and 58 percent expect to increase their EM allocation over the course of the next 12 months. Only 4 percent of respondents have a lower allocation today than 12 months ago and 3 percent expect to lower their allocation in the coming 12 month period.&rdquo;
Related Links:
<a href="https://www.benzinga.com/trading-ideas/long-ideas/17/08/9884829/small-cap-relief-in-emerging-markets">EM Small-Cap ETF Surges</a>
<a href="https://www.benzinga.com/trading-ideas/long-ideas/17/08/9878484/a-view-on-the-vietnam-etf">A View On The Vietnam ETF</a>

Long Ideas

Emerging Markets

Emerging Market ETFs

Markets

Trading Ideas

ETFs

Emerging Global Shares Dow Jones Emerging Marketsnsumer Titan Index Fund

ECON

HILO

INCO

Emerging Global Shares INDXX India Small Cap Fund

SCIN

Survey Says Investors Are Bullish On Emerging Markets

July was a lethargic month for U.S. stocks with the S&amp;P 500 adding just 0.2 percent for the month, but the Nasdaq Composite impressed with a gain of 2.8 percent.

	Still, six of the top 10 asset-gathering exchange traded funds for the month of July were U.S.-focused equity funds. Investors were somewhat less enthusiastic about international ETFs as just two ranked among the top asset gatherers while four such funds were among the month&#39;s worst in terms of lost assets. Speaking of lost assets, gold ETFs fell out of favor in a significant fashion last month with the SPDR Gold Shares (NYSE: <a class="ticker" href="/stock/gld#NYSE">GLD</a>) bleeding $1.11 billion in assets. Just two other ETFs lost more assets last month.
<h3>
	This Week</h3>

	Looking to the first week of August, ETFs that bear monitoring include the PowerShares QQQ (NASDAQ: <a class="ticker" href="/stock/qqq#NASDAQ">QQQ</a>), the Nasdaq-100 tracking ETF. As was noted at the outset, the Nasdaq jumped nearly 3 percent last month, but the bulk of those gains are coming from a small number of stocks.

	Year-to-date and in alphabetical order, Amazon.com, Inc.&nbsp;(NASDAQ: <a class="ticker" href="/stock/amzn#NASDAQ">AMZN</a>), Apple Inc.&nbsp;(NASDAQ: <a class="ticker" href="/stock/aapl#NASDAQ">AAPL</a>), Facebook Inc (NASDAQ: <a class="ticker" href="/stock/fb#NASDAQ">FB</a>), Gilead Sciences, Inc.&nbsp;(NASDAQ: <a class="ticker" href="/stock/gild#NASDAQ">GILD</a>), Google Inc (NASDAQ: <a class="ticker" href="/stock/goog#NASDAQ">GOOG</a>) and Netflix, Inc.&nbsp;(NASDAQ: <a class="ticker" href="/stock/nflx#NASDAQ">NFLX</a>) account for over&nbsp;<a href="http://stocktwits.com/Lach14/message/40642479?utm_campaign=outboundteam&amp;utm_medium=community-twitter&amp;utm_source=t.co">half of the Nasdaq&#39;s gain</a>.

	Those stocks combine for about 34 percent of QQQ&#39;s weight. The ETF added $1.38 billion in new assets last month, according<a href="https://www.invesco.com/portal/site/us/financial-professional/etfs/tools/flow-trend-tracker">&nbsp;to PowerShares data.</a>

	Not to <a href="http://www.benzinga.com/trading-ideas/long-ideas/15/07/5720550/telling-signs-about-risk-appetite-from-sector-etfs">beat a dead horse</a> here, but the Consumer Staples Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xlp#NYSE">XLP</a>), the largest and most heavily traded consumer staples ETF, is an ETF to keep an eye on the week ahead. As noted several times last week, XLP had a banner July, surging about 4 percent.
<p 
	With a risk-off attitude currently permeating equity markets, several big-name consumer staples names still left to report earnings, XLP is one ETF to watch this week. CVS Health (NYSE: <a class="ticker" href="/stock/cvs#NYSE">CVS</a>) and Kellogg (NYSE: <a class="ticker" href="/stock/k#NYSE">K</a>) are among the XLP holdings due to report this week.

	Speaking of consumer ETFs, the Consumer Discretionary Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xly#NYSE">XLY</a>) and rival consumer discretionary ETFs will be in play this week as Dow component Walt Disney Co&nbsp;(NYSE: <a class="ticker" href="/stock/dis#NYSE">DIS</a>) steps into the earnings confessional on Tuesday. Priceline (NASDAQ: <a class="ticker" href="/stock/pcln#NASDAQ">PCLN</a>) follows on Wednesday both stocks are top 10 holdings in XLY.
<h3>
	Greece...</h3>

	Stop us if you&#39;ve heard this before, but the Global X FTSE Greece 20 ETF (NYSE: <a class="ticker" href="/stock/grek#NYSE">GREK</a>) will command attention this week. Greek equity markets are expected to reopen after being closed&nbsp;<a href="http://www.benzinga.com/trading-ideas/long-ideas/15/07/5725308/greece-remains-the-only-game-in-town-and-the-game-is-ugly">for five weeks</a> and media reports out over the weekend say Greece is looking for 24 billion euros as the first step in its latest bailout package.

	For investors insisting on dancing with emerging markets ETFs, India might be the place to look. Somewhat quietly, two India ETFs were found among the top 15 non-leveraged ETFs in July. The Market Vectors India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scif#NYSE">SCIF</a>) jumped almost 10 percent while the EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>) climbed 5.2 percent.
</p

Sector ETFs

Broad U.S. Equity ETFs

Short Ideas

Specialty ETFs

Eurozone

Previews

AAPL

AMZN

GILD

GOOG

GREK

NFLX

PCLN

SCIF

Select Sector SPDR-Consumer Discretionary

A Look Ahead: Consumer Discretionary And Greek ETFs To Watch This Week

Indian equity markets are booming, and aren&rsquo;t showing any signs of slowing down. The surprise rate cut executed by the <a href="http://www.benzinga.com/topic/Chinese-Central-Bank">Chinese Central Bank</a> in order to fight its slowing growth, as well as <a href="http://www.benzinga.com/topic/European-Central-Bank">European Central Bank</a>&nbsp;President Mario Draghi&rsquo;s commitment to its stimulus package has provided the Indian economy with plenty of fuel to pull away from the other BRICS countries (Brazil, Russia, India, China and South Africa).

	The slowing of the economies China and the eurozone helped India&rsquo;s major indices, the Sensex and Nifty, to hit new highs last week. This bolstered the hope that the <a href="http://www.benzinga.com/topic/reserve-bank-of-india">Reserve Bank of India</a> (RBI) will ease monetary policy before its review on December 2 in order to trigger more economic growth.

	Highlighted below are a number of ETFs that have benefited from India&rsquo;s recent boom and may continue to if the RBI decides to ease its monetary policy.

	<bzrelatedlink>Related Link: <a href="http://www.benzinga.com/etfs/emerging-market-etfs/14/11/4999803/the-best-and-worst-bric-country-etfs">The Best And Worst BRIC Country ETFs</a></bzrelatedlink>
<h3>
	iPath MSCI India Index ETN</h3>

	The Barclays Bank Plc iPath ETNs linked to the MSCI India Total (NYSE: <a class="ticker" href="/stock/inp#NYSE">INP</a>) follows 76 publicly traded Indian companies across 10 sectors. The most heavily-weighted sectors are information technology at 22 percent, financials at 19 percent and energy at 12 percent.

	The top individual holdings include:
<ul>
<li>
		Infosys Ltd ADR (NYSE: <a class="ticker" href="/stock/infy#NYSE">INFY</a>) with an 11.5 percent holding</li>
<li>
		Housing Development Finance Corp Ltd. making up 9.2 percent</li>
<li>
		Reliance Industries Limited coming in at 7.3 percent</li>
</ul>

	INP is up 30 percent year-to-date and up 10 percent over the last six months. The ETN has a yearly fee of 0.89 percent.
<h3>
	WisdomTree India Earnings Fund</h3>

	The WisdomTree India Earnings Fund (ETF) (NYSE: <a class="ticker" href="/stock/epi#NYSE">EPI</a>) measures the performance of companies incorporated and traded in India that are profitable and are eligible to be purchased by foreign investors.

	EPI consists of 220 companies across 10 sectors. Financials, information technology and energy are the most heavily-weighted sectors, similar to INP.

	The top three holdings are the same as INP with different weights:
<ul>
<li>
		Reliance Industries Ltd coming in at 8.3 percent</li>
<li>
		Infosys with an 8.1 percent holding</li>
<li>
		Housing Development Finance making up 6.8 percent</li>
</ul>

	EPI is up 33 percent year-to-date and 5 percent over the last six months. The ETF has an expense ratio of 0.83 percent.
<h3>
	EG Shares India Consumer ETF</h3>

	The EG Shares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>) consists of 30 publicly traded companies in the consumer industry in India. Consumer goods is the most weighted sector at 79 percent followed by Industrials at 15 percent.

	The top individual holdings include:
<ul>
<li>
		MRL Corporation Ltd at 6 percent</li>
<li>
		Motherson Sumi Systems Limited making up 5.8 percent</li>
<li>
		Bosch Ltd also at 5.8 percent</li>
</ul>

	INCO is up 49 percent year-to-date and 23 percent over the last six months. The ETF has an expense ratio of 0.89 percent.
<h3>
	India Small-Cap Index</h3>

	The Market Vectors India Small Cap Index ETF (NYSE: <a class="ticker" href="/stock/scif#NYSE">SCIF</a>) provides exposure to 102 small-cap Indian companies across ten sectors. The most heavily-weighted sectors are the financials at 27 percent, consumer discretionary at 22 percent and the industrials at 14 percent.

	The top individual holdings include:
<ul>
<li>
		Arvind Limited making up 3.6 percent of the ETF</li>
<li>
		Vakrangee Ltd with a 2.9 percent holding</li>
<li>
		Unitech Ltd coming in at 2.9 percent as well</li>
</ul>

	SCIF is up 49 percent year-to-date and 0.4 percent over the last six months. The ETF has an expense ratio of 0.93 percent.

	It is unclear whether the RBI will cut rates in its next policy review. However, India is well positioned to continue to outperform under the new rule of President Modi and with gas prices falling regardless of what the RBI decides.&nbsp;

INFY

4 Outperforming Indian ETFs

Big winners (up at least 5%): Market Vectors Indonesia ETF (NYSE: <a class="ticker" href="/stock/idx#NYSE">IDX</a>), iShares MSICI Thailand Investable Market ETF (NYSE: <a class="ticker" href="/stock/thd#NYSE">THD</a>), iShares MSCI Turkey ETF (NYSE: <a class="ticker" href="/stock/tur#NYSE">TUR</a>) and the Market Vectors Indonesia Small-Cap ETF (NYSE: <a class="ticker" href="/stock/idxj#NYSE">IDXJ</a>).

	Big losers (down at least 5%): ProShares UltraShort MSCI Brazil (NYSE: <a class="ticker" href="/stock/bzq#NYSE">BZQ</a>), VelocityShares Daily 2x VIX ST ETN (NYSE: <a class="ticker" href="/stock/tvix#NYSE">TVIX</a>), C-Tracks Citi Volatility Index TR ETN (NYSE: <a class="ticker" href="/stock/cvol#NYSE">CVOL</a>) and the ProShares UltraShort MSCI Emerging Markets (NYSE: <a class="ticker" href="/stock/eev#NYSE">EEV</a>).

	Unusual volume (at least 5X ADV): CurrencyShares Australian Dollar Trust (NYSE: <a class="ticker" href="/stock/fxa#NYSE">FXA</a>), EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>), EGShares India Infrastructure ETF (NYSE: <a class="ticker" href="/stock/inxx#NYSE">INXX</a>), Global X NASDAQ China Technology ETF (NASDAQ: <a class="ticker" href="/stock/qqqc#NASDAQ">QQQC</a>) and the Guggenheim Shipping ETF (NYSE: <a class="ticker" href="/stock/sea#NYSE">SEA</a>).

	ETF must reads of the day:

	Yes, really: <a href="http://www.bloomberg.com/news/2013-09-09/ibovespa-approaches-bull-market-as-vale-gain-outweighs-ogx-drop.html">A Brazilian bull market</a>.

	Speaking of Brazil, ETF <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/09/3897551/backdoor-brazil-with-these-etfs">ideas for those afraid of commitment</a>.

	Pathfinder Buzz <a href="http://pathfinderbuzz.com/philippines-offer-etf-investment-opportunity/">looks at the Philippines</a>.

	Crazy for value ETFs? Check out <a href="http://online.barrons.com/article/SB50001424052748704287804579042972310024990.html?mod=BOL_twm_col">this article</a>.

	From WisdomTree: Refuge from rising rates <a href="http://www.wisdomtree.com/blog/index.php/chinese-yuan-a-potential-alternative-for-a-rising-rate-environment/">with the Chinese yuan</a>.

	This week's <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/09/3895139/a-look-ahead-this-weeks-etfs-to-watch">ETF's to watch</a>.

New ETFs

Currency ETFs

After-Hours Center

CVOL

ProShares UltraShort MSCI Emerging Markets

IDXJ

Emerging Global Shares INDXX India Infrastructure Index Fund

INXX

QQQC

iShares MSCI Thailand Investable Market Index Fund

iShares MSCI Turkey Investable Market Index Fund

TVIX

Benzinga's Mandatory ETF Reading for September 9, 2013

Big winners (up at least 5%): ProShares Ultra Silver (NYSE: <a class="ticker" href="/stock/agq#NYSE">AGQ</a>), Direxion Daily Real Estate Bull 3X Shares (NYSE: <a class="ticker" href="/stock/drn#NYSE">DRN</a>), Direxion Daily India Bull 3X Shares (NYSE: <a class="ticker" href="/stock/indl#NYSE">INDL</a>) and the Direxion Daily Latin America Bull 3X Shares (NYSE: <a class="ticker" href="/stock/lbj#NYSE">LBJ</a>).

	Big losers (down at least 5%): ProShares UltraShort Silver (NYSE: <a class="ticker" href="/stock/zsl#NYSE">ZSL</a>), Direxion Daily Real Estate Bear 3X Shares (NYSE: <a class="ticker" href="/stock/drv#NYSE">DRV</a>) and the iPath Global Carbon ETN (NYSE: <a class="ticker" href="/stock/grn#NYSE">GRN</a>).

	Unusual Volume (at least 5X ADV): PowerShares DB Base Metals Short ETN (NYSE: <a class="ticker" href="/stock/bos#NYSE">BOS</a>), iShares Barclays CMBS Bond ETF (NYSE: <a class="ticker" href="/stock/cmbs#NYSE">CMBS</a>), PowerShares S&amp;P Emerging Markets High Beta (NYSE: <a class="ticker" href="/stock/eehb#NYSE">EEHB</a>), iShares MSCI New Zealand Investable Market ETF (NYSE: <a class="ticker" href="/stock/enzl#NYSE">ENZL</a>), EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>) and the iShares MSCI India Small Cap ETF (BATS: SMIN).

	Today's ETF must reads:

	Say good-bye to <a href="http://www.benzinga.com/news/13/09/3893529/egshares-to-liquidate-12-of-its-etfs">these 12 emerging markets ETFs</a>.

	Bloomberg: Malaysia is now riskier than <a href="http://www.bloomberg.com/news/2013-09-05/malaysia-risk-tops-philippines-on-najib-budget-gap.html">this Asian hot spot</a>.

	Skirt rising interest rates <a href="http://www.etftrends.com/2013/09/internet-etfs-a-rising-rates-sanctuary/">with Facebook, Amazon and friends</a>.

	America's "retardedly distorted labor regime" <a href="http://www.thereformedbroker.com/2013/09/06/chart-o-the-day-our-new-part-time-economy/">in focus here</a>.

	Herbalife, Oil ETFs <a href="http://allstarcharts.com/fridays-with-pearlman/">and emerging markets</a> oh my.

	Free tips on <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/09/3892134/diversified-emerging-markets-etfs-with-rebound-potential">emerging markets ETFs</a>.

	Don't forget to contact me on Twitter <a href="https://twitter.com/ETFProfessor1">@ETFProfessor1</a> to have content included in Mandatory ETF Reading.

News

CMBS

Direxion Daily Real Estate Bull 3x Shares

EEHB

iShares MSCI New Zealand Investable Market Index Fund

ENZL

INDL

SMIN

Benzinga's Mandatory ETF Reading for September 6, 2013

Big winners (up at least 5%): Global X Brazil Financials ETF (NYSE: <a class="ticker" href="/stock/braf#NYSE">BRAF</a>), Direxion Daily India Bull 3X Shares (NYSE: <a class="ticker" href="/stock/indl#NYSE">INDL</a>), iShares MSCI EM Energy Sector Capped ETF (NYSE: <a class="ticker" href="/stock/emey#NYSE">EMEY</a>) and the Direxion Daily Latin America Bull 3X Shares (NYSE: <a class="ticker" href="/stock/lbj#NYSE">LBJ</a>).

	Big losers (down at least 5%): Market Vectors Junior Gold Miners ETF (NYSE: <a class="ticker" href="/stock/gdxj#NYSE">GDXJ</a>), ProShares UltraShort MSCI Brazil (NYSE: <a class="ticker" href="/stock/bzq#NYSE">BZQ</a>), Direxion Daily Gold Miners Bull 3X Shares (NYSE: <a class="ticker" href="/stock/nugt#NYSE">NUGT</a>) and the ProShares Ultra DJ-UBS Natural Gas (NYSE: <a class="ticker" href="/stock/boil#NYSE">BOIL</a>).

	Unusual volume (at least 5X ADV): BRAF, PowerShares DB G10 Currency Harvest ETF (NYSE: <a class="ticker" href="/stock/dbv#NYSE">DBV</a>), iShares MSCI Poland Investable Market Index Fund (NYSE: <a class="ticker" href="/stock/epol#NYSE">EPOL</a>), iShares MSCI Global Energy Producers ETF (NYSE: <a class="ticker" href="/stock/fill#NYSE">FILL</a>), EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>) and the PowerShares S&amp;P International Developed Markets High Beta (NYSE: <a class="ticker" href="/stock/idhb#NYSE">IDHB</a>).

	Must reads of the day:

	The alternative, but positive view on <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/09/3890794/biotech-breakout-highlights-flawed-etf-thinking">biotech ETFs</a>.

	This is how bad August was for ETFs. Audio <a href="http://www.bloomberg.com/video/august-is-worst-etf-outflows-month-ever-L74988VxSmaZB9rtskRxQw.html">courtesy of Bloomberg</a>.

	A look at the <a href="http://www.etftrends.com/2013/09/nyse-looks-to-boost-activity-in-thinly-traded-etfs/">NYSE ETF liquidity program</a>.

	Barrons: Pension Bond Problems Ding <a href="http://blogs.barrons.com/focusonfunds/2013/09/05/plan-to-grab-37b-in-pension-bonds-sends-poland-etf-plummeting-5/">Poland ETFs</a>.

	Check out these <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/09/3890487/unique-china-etfs-in-rally-mode">unique China ETFs</a>.

	To have ETF-related content featured in Benzinga's Mandatory ETF Reading, please contact me on Twitter <a href="https://twitter.com/ETFProfessor1">@ETFProfessor1</a>.

Barron's

BOIL

BRAF

EMEY

iShares MSCI Poland Investable Market Index Fund ETF

EPOL

FILL

GDXJ

IDHB

NUGT

Benzinga's Mandatory ETF Reading for September 5, 2013 

Exchange traded funds tracking India, the "I" in the venerable and now infamous BRIC acronym, really do not need any more bad news.

	Already the worst performers among the single-country BRIC funds, India ETFs have been beset by sagging growth, a plunging rupee that has touched multiple record lows against the U.S. dollar and a widening current deficit, it would seem investors would be running short on negative tidings pertaining to Asia's third-largest economy.

	JPMorgan sees things differently. During Tuesday's Asian session, the bank downgraded its rating on Indian stocks to Neutral from Overweight. To its credit, JPMorgan acknowledged it was late in downgrading India, but said if the rupee continues to tumble, Indian stocks would continue to lag, <a href="http://in.reuters.com/article/2013/08/20/markets-india-jpmorgan-sensex-idINDEE97J01M20130820">Reuters reported</a>.

	Related: <a href="http://www.benzinga.com/analyst-ratings/analyst-color/13/08/3806074/more-misery-ahead-for-india-etfs">More Misery Ahead For India ETFs</a>.

	Citigroup chimed in, paring its target on the BSE Sensex to 18,900 from 20,800. All that just a couple of weeks after Goldman Sachs pared its rating on the country's stocks to Underweight. And all that as seven India ETFs reside on the list of the 18 worst-performing ETFs over the past month. That list includes the Direxion Daily India Bull 3X Shares (NYSE: <a class="ticker" href="/stock/indl#NYSE">INDL</a>), which undergoes a <a href="http://www.benzinga.com/news/13/07/3779977/direxion-announces-forward-reverse-splits-on-9-etfs">1-for-4 reverse split today</a>.

	That list also includes the Market Vectors India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scif#NYSE">SCIF</a>), which was reverse split <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/06/3699927/reverse-splits-coming-for-7-market-vectors-etfs">1-for-4 at the start of July</a>.

	Underscoring just how bad some ETFs have been this year, the EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>), the EGShares India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scin#NYSE">SCIN</a>), the EGShares India Infrastructure ETF (NYSE: <a class="ticker" href="/stock/inxx#NYSE">INXX</a>) and the iShares MSCI India Small-Cap ETF (BATS: SMIN) have all posted declines of at least 16 percent in the past month and none of those funds reside on the aforementioned list of India ETF infamy.

	There have been <a href="http://www.benzinga.com/trading-ideas/long-ideas/13/04/3534252/an-almost-rally-for-india-etfs">times this year</a> when Indian stocks and ETFs looked good. There were even times when foreign investors were putting capital to work in Indian equities, but the falling rupee and talk of Federal Reserve have put those themes to rest.

	Foreigners have pulled about $12 billion from local stocks and bonds while the rupee has plunged 14 percent since May 22 when tapering chatter began in earnest, <a href="http://www.bloomberg.com/news/2013-08-19/jpmorgan-says-buy-indian-options-as-stock-swings-widen.html">according to Bloomberg</a>.

	A simple way of looking at the rupee recently has been to say if the forex market is open, there is a good chance the Indian currency is touching another record low against the dollar. That is regularly the rupee has been hitting record lows against the greenback.

	That regularity is frightening given the Reserve Bank of India's efforts to stem the currency's slide. RBI has has raised the marginal standing facility and bank rates, capped injections into the financial system and tightened banks' daily reserve requirements to curb money supply, Bloomberg report. And that is just since last month.

	Over that same time, all five of the India ETFs with at least $200 million in assets under management have posted declines in the teens on a percentage basis with the iPath MSCI India Index ETN (NYSE: <a class="ticker" href="/stock/inp#NYSE">INP</a>) being the worst offender. Since May 20, all five have tumbled by more than 20 percent, meaning all five are officially in bear market territory.

	For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

	Disclosure: Author owns known of the securities mentioned here.

Downgrades

Price Target

Technicals

Forex

Global

Intraday Update

Analyst Ratings

Now This For India ETFs: JPMorgan's No Fan

The case for some low volume ETFs was bolstered a bit on Friday when the <a href="http://online.wsj.com/article/SB10001424127887323277504578191363832450972.html">the Wall Street Journal examined the debate</a>. As has been previously noted, <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/2955946/argument-for-low-volume-etfs-gains-steam">investors, both professional and retail</a>, have been reluctant to embrace those ETFs with low average daily volume numbers due to perceived liquidity risks.

Citing ETF issuer Guggenheim, the Journal only a quarter of the ETFs on the market today trade over 100,000 per shares today. So for every SPDR S&amp;P 500 (NYSE: <a class="ticker" href="/stock/spy#NYSE">SPY</a>), PowerShares QQQ (NASDAQ: <a class="ticker" href="/stock/qqq#NASDAQ">QQQ</a>) and Vanguard MSCI Emerging Markets ETF (NYSE: <a class="ticker" href="/stock/vwo#NYSE">VWO</a>), there are a slew of funds seeing paltry volume on a daily basis.

Of course, and <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/07/2742958/low-volume-high-returns-for-these-etfs-bib-fhc-drw">this point has been previously noted as well</a>, an ETF's volume is not indicative of its ability to generate positive returns for investors. Here is just one prime example: Over the past year, the EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>) has surged more than 56 percent. INCO's average daily turnover is just 8,550 shares for the past three months.

Not all ETFs, low volume or otherwise, can be INCO in terms of performance, but the following group of lightly traded funds have considerable upside potential for 2013.

Market Vectors Russia Small-Cap ETF (NYSE: <a class="ticker" href="/stock/rsxj#NYSE">RSXJ</a>)
The Market Vectors Russia Small-Cap ETF trades just about 9,500 shares per day, a far cry from the 4.1 million average for its large-cap cousin, the Market Vectors Russia ETF (NYSE: <a class="ticker" href="/stock/rsx#NYSE">RSX</a>). At this writing late in Friday's trading session, the bid/ask spread on RSXJ was just three cents, according to Bloomberg data, and that was with volume in RSXJ below the daily average. 

It is possible that is an indication that investors, particularly those that use limit orders, will not be subjective to punitively wide bid/ask spreads with RSXJ. As for why RSXJ can move higher in 2013, there are at least two big reasons. First, <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/12/3198859/can-bric-small-cap-etfs-do-it-again-in-2013">Russian stocks are cheap even by their standards</a> of trading at discounts to the broader emerging markets universe. However, at the end of November, RSXJ had a P/E ratio of 3.4 and a price-to-book ratio of just 0.8, making the ETF even less expensive than RSX.

Second, the Russian government is taking steps to open its economy in a bid to attract more foreign investment. Should those efforts prove helpful, RSXJ stands to benefit because it offers a less energy heavy approach to Russia than its large-cap counterparts.

First Trust US IPO Index Fund (NYSE: <a class="ticker" href="/stock/fpx#NYSE">FPX</a>)
Apparently, folks prefer trading individual stock IPOs over an ETF that holds a basket of such stocks because FPX's average daily turnover is just over 6,900 shares. That has not stopped the fund from soaring 30.4 percent in the past year. 

Investors should note that all not new IPOs, no matter how hot, find their way into FPX. FPX's "index is a rules based value-weighted index measuring the average performance of U.S. IPOs during the first 1000 trading days. Index constituents are selected based on quantitative initial screens," <a href="http://www.ftportfolios.com/Retail/Etf/EtfSummary.aspx?Ticker=FPX">according to First Trust</a>.

Home to 100 stocks, including familiar names such as Facebook (NASDAQ: <a class="ticker" href="/stock/fb#NASDAQ">FB</a>), Michael Kors (NYSE: <a class="ticker" href="/stock/kors#NYSE">KORS</a>) and Phillips 66 (NYSE: <a class="ticker" href="/stock/psx#NYSE">PSX</a>), FPX's volume belies its liquidity. The ETF's top-10 holdings account for about half of the fund's weight and not one of those names has average daily volume below 1 million shares.

iShares S&amp;P Global Financials Sector Index Fund (NYSE: <a class="ticker" href="/stock/ixg#NYSE">IXG</a>)
If 100,000 shares is the watermark for what is and is not thinly traded, than IXG barely qualifies as the latter with average turnover of almost 96,000 shares per day. If that is enough to assuage volume fanatics, then IXG's lineup should be. The ETF's top-10 lineup includes heavily traded fare such as Bank of America (NYSE: <a class="ticker" href="/stock/bac#NYSE">BAC</a>), Citigroup (NYSE: <a class="ticker" href="/stock/c#NYSE">C</a>) and Banco Santander (NYSE: <a class="ticker" href="/stock/san#NYSE">SAN</a>), indicating that creating and redeeming shares in this ETF is not a high-risk endeavor.

Even when moving further down IXG's 217-stock lineup, it becomes clear that essentially all of the ETF's U.S.-listed issues are heavily traded while the vast majority of the fund's holdings that are listed in foreign markets also see robust turnover.

With U.S. banks accounting for just 38.5 percent of IXG's weight, the ETF's ability to repeat or top its 26.5 gain over the past year will come to just how much help the fund gets from its Australian, Japanese and European constituents. A spate of dividend increases and/or share buyback announcements from IXG's Canadian and U.S. money center bank holdings would constructive as well.

For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

Wall Street Journal

IPOs

iShares Trust S&P Global Financials Sector Index Fund

KORS

Market Vectors Russia ETF Trust Shares of Beneficial Interest

RSXJ

These Low Volume ETFs Could Thrive in 2013

Despite a slack performance by the iShares MSCI Brazil Index Fund (NYSE: <a class="ticker" href="/stock/ewz#NYSE">EWZ</a>), which is off almost 4.5 percent for the year, the four major country-specific ETFs tracking the BRIC nations have performed well as a group. 

The other three ETFs are the iShares FTSE China 25 Index Fund (NYSE: <a class="ticker" href="/stock/fxi#NYSE">FXI</a>), the WisdomTree India Earnings ETF (NYSE: <a class="ticker" href="/stock/epi#NYSE">EPI</a>) and the Market Vectors Russia ETF (NYSE: <a class="ticker" href="/stock/rsx#NYSE">RSX</a>). Throw in EWZ and the average return for that quartet of BRIC ETFs is 9.1 percent. That is solid, but not aw-inspiring, particularly when the far less volatile SPDR S&amp;P 500 (NYSE: <a class="ticker" href="/stock/spy#NYSE">SPY</a>) is up 13.4 percent.

The 2012 picture for BRIC ETFs is a bit prettier at the small-cap level. Using the Market Vectors Brazil Small-Cap ETF (NYSE: <a class="ticker" href="/stock/brf#NYSE">BRF</a>), the Market Vectors India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scif#NYSE">SCIF</a>), the Guggenheim China Small-Cap ETF (NYSE: <a class="ticker" href="/stock/hao#NYSE">HAO</a>) and the Market Vectors Russia ETF (NYSE: <a class="ticker" href="/stock/rsxj#NYSE">RSXJ</a>) would have generated an average return of nearly 11.4 percent across the four funds and that includes a loss of almost 11.8 percent for the Market Vectors Russia Small-Cap ETF.

If investors swapped out of BRF in favor of the iShares MSCI Brazil Small Cap Index Fund (NYSE: <a class="ticker" href="/stock/ewzs#NYSE">EWZS</a>) and out of the SCIF in favor of the EGShares India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scin#NYSE">SCIN</a>), the average return for a quartet of BRIC small-cap ETFs jumps to 14.3 percent. So split the difference between the two combinations – BRF, SCIF, HAO and RSJX and EWZS, HAO, RSXJ and SCIN and the average return between the two groups is about 13 percent.

Either way, investors that wanted exposure to each BRIC nation on an individual basis would have done better with small-caps ETFs than with large-cap equivalents. With just a few trading days left in 2012, the question is whether BRIC small-caps will continue outperforming in 2013. The answer should be addressed at the country level to start.

Russia
Starting with Russia makes sense because while the Market Vectors Russia ETF has been a laggard itself with a gain of just under eight percent, its small-cap counterpart RSXJ, has been far worse with the aforementioned 11.8 percent loss. The bottom line is Russia has been a BRIC laggard this year relative to China and India and only looks good in comparison to Brazil.

However, there are some positive signs for Russia bulls, starting with valuation. Investors have heard it all before, but the equity valuations across the BRIC nations can be described as compelling. While Russia historically trades at a discount to the broader emerging markets universe, Russian <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/11/3087327/russian-equities-etfs-cheap-and-getting-cheaper">are now inexpensive relative to historical standards</a>. 

As for Russian small-caps, they are even cheaper than the large-caps. At the end of November, RSXJ had a P/E ratio of 3.4 and a price-to-book ratio of just 0.8. Earlier this year, J.P. Morgan noted Russian equities were trading at <a href="https://www.jpmorganfunds.com/cm/Satellite?pagename=jpmfVanityWrapper&amp;UserFriendlyURL=portfoliodiscussions&amp;portfoliodiscussionid=1320482219314&amp;slideid=1159397330775&amp;discussions=true&amp;count=3&amp;rmid=1320482219314">3.6 times price to free cash flow, well below the 10-year average of 4.9</a>.

There is also talk that Russia, in an effort to attract more foreign investment, is legitimately working to diversify its economy. That too would benefit RSXJ because by the standards of energy-heavy large-cap Russia ETFs, RSXJ is diverse. Energy names account for over a quarter of the ETF's weight, but <a href="http://vaneck.com/funds/RSXJ.aspx">materials and industrial names</a> are also on prominent display. 

Additionally, the Russian government has passed a law mandating that state-owned firms start doling 25 percent of their profits in the form of dividends. Russian firms have a reputation for being highly profitable, broadly speaking, and the country's new found affinity for dividends from state-owned firms could lead to more dividend increases from an array of firms. RSXJ's exposure to energy, financial services and materials names positions the ETF to take advantage of that trend, implying the fund should perform better in 2013.

India
In addition to SCIF and SCIN, there is another India small-cap ETF on the market, the newly minted iShares MSCI India Small Cap Index Fund (BATS: SMIN). Over the past six months, all three have performed admirably, though SCIN and SMIN have been the better bets.

With the recent bout of weakness in Indian information technology firm Infosys, a marquee component in many India large-cap ETFs, <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/12/3195203/as-infosys-slides-small-cap-etfs-may-be-better-indian-bet">the small-cap funds once again look like fine avenues for playing Asia's third-largest economy</a>.

The Indian consumer will be the story that drives the returns offered by many Indian small-caps – in either direction. There is evidence that story is starting to take hold in the way India bulls envisioned. Just look at the returns offered by the EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>) and the good news the small-cap funds are levered to that story as well. Over 21 percent of SCIN's sector allocations are direct plays on the consumer. SCIF is in the area of 20 percent while a combined 23.7 percent of SMIN's weight goes to discretionary and staples names.

The issue is by how much will the small-cap ETFs outpace their large-cap rivals by. For example, SCIN has outperformed EPI by about 860 basis points in 2012. That is a wide chasm and that pace may be difficult to maintain two years in a row.

Brazil
Charles Dickens once wrote about tales of two cities, but the varying performances of Brazil large-cap ETFs, such as EWZ, and small-cap funds, such as BRF and EWZS, paint a picture of two Brazils. Several issues explain the chasm between Brazilian large- and small-caps in 2012.

First, global investors spent much of 2012 fretting about an economic slowdown in China, Brazil's top trading partner. Predictably, that hampered shares of Brazilian energy and materials names. Those sectors combine for over 36 percent of EWZ's weight, but only receive token allocations in BRF and EWZS. 

Second, Brazil's efforts to stimulate the domestic economy through infrastructure programs <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/11/3068174/this-brazil-etf-could-be-headed-for-disappointment">have largely passed over large-caps</a>. However, various government stimulus efforts, whether it be consumption taxes or the aforementioned infrastructure largess, have boosted Brazil's small-caps.

Third, despite interest rates on consumer credit that would be considered absurdly high in the developed word, the Brazilian consumer is alive and kicking. A 31 percent gain for the Global X Brazil Consumer ETF (NYSE: <a class="ticker" href="/stock/braq#NYSE">BRAQ</a>) says as much. That has been good news for BRF and EWZS as well as those funds allocate 28 percent and 43 percent of their weights, respectively, to consumer-related shares.

Brazilian small-caps now face competing valuations views. In September, Brazil's small-cap index touched a book value of 1.59, <a href="http://www.bloomberg.com/news/2012-09-21/small-caps-rule-bovespa-as-stimulus-skips-vale-corporate-brazil.html">according to Bloomberg</a>. That is frothy by historical standards. EWZS has a P/E ratio of 24.35 and a price-to-book ratio of 2.39, <a href="http://us.ishares.com/product_info/fund/overview/EWZS.htm">according to iShares data</a>.

BRF trades at 18.13 times earnings and 1.44 times book value, Market Vectors data indicate. As measured by the iShares Russell 2000 Index Fund (NYSE: <a class="ticker" href="/stock/iwm#NYSE">IWM</a>), U.S. small-caps are more expensive. That ETF has a <a href="http://us.ishares.com/product_info/fund/overview/IWM.htm?fundSearch=true&amp;qt=IWM">P/E ratio of 25.22 and a price-to-book ratio of 3.1</a>.

China
When Chinese ETFs are performing well, the Guggenheim China Small-Cap ETF (NYSE: <a class="ticker" href="/stock/hao#NYSE">HAO</a>) usually outpaces the iShares FTSE China 25 Index Fund. On the way down, the opposite is true, but investors must acknowledge China ETFs have perked up over the past three months. Over that time, HAO has outperformed FXI by almost 500 basis points. Year-to-date, HAO's advantage of FXI is nearly 600 basis points.

Clearly, a big risk to HAO's potential upside in 2013 is the controversy that often surrounds Chinese small-caps. Fraudulent accounting, reverse mergers and myriad other unsavory acts have help Chinese small-caps become ensconced in controversy. 

Regarding HAO, there is some good news. Many of worst offenders among controversial Chinese small-caps are found in the media, Internet, technology and alternative energy sectors. Those industry groups receive scant representation in HAO. Another advantage HAO offers is that it is home to 226 stocks, none of which accounts for more than 1.13 percent of the fund's weight. That means if a Sino Forest-like debacle repeats itself with one of HAO's holdings, the ETF is not likely to suffer significant losses.

HAO's next advantage is exposure to the Chinese consumer through a combined allocation of 24 percent to discretionary and staples names. With China's government working diligently to steer the world's second-largest economy towards more domestic consumption, HAO is positioned to benefit if those efforts prove successful.

Then there is valuation. For what felt like an eternity, China bulls <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/2975987/believe-china-is-cheap-try-these-etfs">kept saying how cheap Chinese stocks were</a>. The recent bounce indicates investors have finally bought into that thesis. As measured by HAO, Chinese small-caps are even cheaper. 

HAO has a P/E ratio of 7.9 and a price-to-book ratio of just one, <a href="http://guggenheiminvestments.com/products/etf/hao">according to Guggenheim data</a>. Not only does that mean the ETF is far less expensive than U.S. small-caps as tracked by IWM, but HAO is also less pricey than FXI. FXI trades at almost 12.9 times earnings with a price-to-book ratio of 1.61. All this is a long way of saying, yes, HAO can repeat its 2012 bullishness in 2013.

For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

Small Cap Analysis

Commodities

Small Cap

Events

Pre-Market Outlook

BRAQ

EWZS

Can BRIC Small-Cap ETFs do it Again in 2013?

Using the WisdomTree India Earnings ETF (NYSE: <a class="ticker" href="/stock/epi#NYSE">EPI</a>) as the measuring stick, India has been the top performer among the BRIC quartet in 2012. Even with a 2.3 percent tumble on Friday, EPI's 20.8 percent year-to-date gain is nearly twice as good as the comparable Russia ETF. EPI has also delivered about 870 basis points more alpha than the largest China ETF. Forget Brazil, because the iShares MSCI Brazil Index Fund (NSYE: EWZ) is down on the year.

The bullish performance of EPI and its counterparts belies the fact that 2012 has been a tumultuous one for Indian stocks. Amid slowing growth, major infrastructure problems and a government accused of not caring much about either issue, <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/04/2535157/a-new-resident-in-the-brics-house-epi-idx-ewz">India was at risk of losing its tenuous investment-grade credit rating</a>. That prompted significant slides in India ETFs during the second quarter.

Fortunately for investors, <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/09/2940097/after-a-rough-patch-india-garners-bull-calls">India's government</a> moved to bolster the economy in the third quarter with policy measures including reduced diesel subsidies and looser rules on foreign ownership in the retail sector.

Indeed, it has been an up-and-down year for Indian equities and some of the corresponding U.S.-listed ETFs. Now, a new issue has entered the picture. That being the slack performance of Indian information technology firm Infosys (NASDAQ: <a class="ticker" href="/stock/infy#NASDAQ">INFY</a>).

Shares of Infosys have plunged 13.5 percent in the past three months, with much of those declines attributable to the company's plan to shift to more of a consulting outfit away from outsourcing, <a href="http://blogs.barrons.com/emergingmarketsdaily/2012/12/20/infosys-tumbles-on-accenture-plunge/?mod=yahoobarrons">as Barron's recently reported</a>. That would put Infosys in direct competition with the likes of Accenture (NYSE: <a class="ticker" href="/stock/acn#NYSE">ACN</a>) and International Business Machines (NYSE: <a class="ticker" href="/stock/ibm#NYSE">IBM</a>).

The problem for India ETFs is that information technology is usually a significant sector weight in the large-cap funds and Infosys is often a top-10 holdings in these ETFs. Infosys is EPI's third-largest holding with a weight of 5.42 percent. The PowerShares India Portfolio (NYSE: <a class="ticker" href="/stock/pin#NYSE">PIN</a>) devotes 9.4 percent to the stock. 

Infosys represents almost six percent of the iShares S&amp;P India Nifty 50 Index Fund's (NASDAQ: <a class="ticker" href="/stock/indy#NASDAQ">INDY</a>) weight and more than seven percent of the iShares MSCI India Index Fund (BATS: INDA). Those weights are not large enough to completely wreck these ETFs (EPI and INDY are slightly higher over the past 90 days), but the Infosys allocations are just enough to be near-term problematic.

The solution for investors looking to stay in the Indian ETF game while dodging Infosys for the time being is easy to spot. That objective can be accomplished with small-cap ETFs. There are three ETFs devoted exclusively to Indian small-caps: The EGShares India Small ETF (NYSE: <a class="ticker" href="/stock/scin#NYSE">SCIN</a>), the Market Vectors India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scif#NYSE">SCIF</a>) and the new iShares MSCI India Small Cap Index Fund (BATS: SMIN).

Over the past 90 days, SMIN has surged 7.4 percent while the average returns offered by SCIF and SCIN are about 4.5 percent. None of these ETFs are heavily exposed to tech stocks and since Infosys is a large-cap, it is barred from entry to these fund.

All are heavy on financials with SMIN devoting almost 28 percent of its weight to the sector. SCIN checks in with an almost 24 percent weight to bank stocks. The real story with India small-cap ETFs, beyond the obvious advantage of not being home to Infosys, is the exposure to the consumer these ETFs offer.

To this point in 2012, the EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>) <a href="http://www.benzinga.com/markets/bonds/12/12/3137418/going-down-the-etf-aum-ladder-can-mean-higher-returns">is far and away the top-performing India ETF</a> with a gain of 51 percent. That performance indicates some investors are feeling good about the potential of the Indian consumer, but others have a tendency to overlook INCO because of its size and low trading volume.

The aforementioned India small-cap ETFs stand as suitable alternatives because all are highly levered to the Indian consumer. Over 21 percent of SCIN's sector allocations are direct plays on the consumer. SCIF is in the area of 20 percent while a combined 23.7 percent of SMIN's weight goes to discretionary and staples names.

The bottom line is that if the Indian consumer proves resilient in 2013, Infosys will have little or no bearing on SCIF, SCIN and SMIN. And that could be a good thing.

For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

Economics

Movers

Tech

INDY

As Infosys Slides, Small-Cap ETFs May be Better Indian Bet

One of this year's more prominent themes in the exchange-traded products industry has been a record number of closures. Ninety-nine to this point in the year, <a href="http://online.wsj.com/article/SB10001424127887323713104578133391130341574.html?mod=googlenews_wsj">the Wall Street Journal reported, citing Lipper data</a>. As the Journal notes, that is more ETF and ETN closures than in the previous three years combined. 

An increased rate of ETF closures is a <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/2971632/closures-part-of-etf-industrys-evolution">sign of an evolving, maturing industry</a>. That much is known, but the naysayers do not stop there. 

Rather, they continue to wage their war of opinion-based criticism on small ETFs, fingering those funds with less than $100 million in assets under management as the next legitimate candidates for closure. As has been previously noted, this talk is not cheap. Actually, it is quite costly because all the fear mongering keeps investors <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/2994238/ignoring-sub-100m-etfs-a-costly-idea">out of many small ETFs with big-time returns</a>.

Investors can only imagine what the critics would have to say about ETFs with less than $50 million in assets under management if those same critics are so ready to assail funds with less than $100 million in AUM. Usually, the arguments revolve around perceived lack of liquidity and wide bid/ask spreads. The latter issue is seen as driving up investors' costs, which is true. However, is the investor that paid a 15-cent spread to buy an ETF that is up 30 percent this year not doing better than the investor that paid a penny spread to get an ETF that has gained just five percent?

Perhaps the small-ETF critics should consider the returns offered by this collection of sub-$50 million funds.

EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>)
Finding coverage of INCO is like looking for a needle in a haystack and that is understandable when considering the fund has less than $2.4 million in AUM, <a href="http://etfdb.com/screener/">according to ETFdb data</a>. However, INCO's lack of coverage should not be condoned.

After all, Indian <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/11/3135191/case-for-em-consumer-bolstered-by-new-statistics">consumer spending is projected to surge</a> in the coming years and INCO offers a direct play on that same. Maybe the ETF is already starting to price that theme in. Despite its diminutive AUM total, INCO is up more than 50 percent year-to-date. Said another way,, an investor would have to add up the returns of two of the most popular India ETFs to arrive at a number that exceeds INCO's returns.

First Trust China AlphaDEX Fund (NYSE: <a class="ticker" href="/stock/fca#NYSE">FCA</a>)
With the one fund controlling the bulk of the assets and volume when it comes to China ETFs, it is easy for rival funds to get lost in the shuffle. The problem is that <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/2990830/china-conundrum-resisting-fxis-temptation">scores of other ETFs outperform the largest China fund</a>, underscoring the notion that bigger is rarely better when it comes to ETFs.

That is certainly the case with the First Trust China AlphaDEX Fund. The fund has just $2.2 million in AUM. Critics would say FCA is a possible candidate for closure. An unlikely scenario given that First Trust has never shuttered an ETF. 

So what have investors sacrificed by passing over FCA for the comfort and tighter bid/ask spreads of the unnamed China ETF giant? Nearly 1,400 basis points of alpha this year. 

Market Vectors Emerging Markets High Yield Bond ETF (NYSE: <a class="ticker" href="/stock/hyem#NYSE">HYEM</a>)
As the mainstream financial press has been so eager to cover outflows from the most popular high-yield bond ETFs, ignored has been the story of the newly minted Market Vectors Emerging Markets High Yield Bond ETF.

HYEM debuted in May, so it is not old enough to draw the ire of the ETF closure crowd. It is, however, young enough for the "investors must let new ETFs age in an oak barrel like a fine whiskey before buying" crowd. Plus, those critics would say HYEM only has $21.1 million in AUM, so it better start attracting inflows soon or else.

Well, performance and yield-hunting are factors that bode well for HYEM's future. The fund has returned nearly 6.2 percent since its debut. By adding up the returns of the two largest U.S.-focused junk bond ETFs over the same time period, investors would still be left with a performance number that trails HYEM by nearly 70 basis points. Oh yes, HYEM yields 6.63 percent and pays a monthly dividend. 

For more on ETFs, click <a href="http://www.benzinga.com/etfs">here</a>.

Bonds

Dividends

HYEM

Going Down The ETF AUM Ladder Can Mean Higher Returns

The investment thesis behind the emerging markets consumer theme has arguably proven to be a dichotomy. Foreign investors grasp the concept of increasing wages, rising middle classes and the benefits those factors can have for a developing economy. 

Conversely, it has been the methods by which investors choose to tap into emerging markets consumers that have proven vexing. On the surface, Western companies with stellar brand recognition such as Coca-Cola (NYSE: <a class="ticker" href="/stock/ko#NYSE">KO</a>) and McDonald's (NYSE: <a class="ticker" href="/stock/mcd#NYSE">MCD</a>) would appear to be fine ways to play consumers in the developing world. The reality is those companies and others like them have massive top lines and emerging markets still only represent a fraction of their revenue.

That is to say, investors are best served by focusing on stocks and ETFs that offer exposure to local brands. Some fresh statistics reiterate as much. 

"Consumer spending will grow faster in Asia's rapid growth markets than in advanced economies. Our forecasts suggest that Asia-Pacific rapid growth markets will see their share of global consumption rise from under 14% in 2010 to almost 25% by 2020," according to an Ernst &amp; Young report on the emerging markets consumer. 

That forecast is not surprising. Earlier this year, Boston Consulting estimated <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/2965345/prepare-for-chindias-consumer-spending-surge-with-etfs">Chinese and Indian consumers will spend a combined $64 trillion</a> in the years leading up to 2020.

There are some direct ETF plays on that theme such as the First Trust ISE Chindia Index Fund (NYSE: <a class="ticker" href="/stock/fni#NYSE">FNI</a>) which offers a sizable allocation to discretionary names. Of course, the Global X China Consumer ETF (NYSE: <a class="ticker" href="/stock/chiq#NYSE">CHIQ</a>) and the EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>) are direct plays on the consumers of those countries, but there is more to the story.

"In rapid growth markets, markets for many consumer goods are reaching ‘takeoff points,' where rising per capita income generates a more-than-proportionate increase in market size. Demand for consumer durables is set to boom," <a href="http://www.ey.com/GL/en/Issues/Driving-growth/Beyond-Asia---new-patterns-of-trade-in-Asia-Pacific---Report-hightlights">said Ernst &amp; Young</a>.

Additionally, Ernst &amp; Young sees a strong increase in exported goods and services in the Pacific Rim over the next decade. That increase will be driven, in part, by booming domestic demand. The domestic demand story in the developing world reminds investors multinationals are not always the best way to tap into the emerging markets consumer.

An alternative avenue is the newly minted EGShares Emerging Markets Domestic Demand ETF (NYSE: <a class="ticker" href="/stock/emdd#NYSE">EMDD</a>). The EGShares Emerging Markets Domestic Demand ETF, which debuted in July, was created to offer investors a better way of exploiting the domestic demand story in the emerging world. U.S. multinationals such as Coca-Cola and McDonald's are not found in this fund.

However, EMDD does offer a direct avenue to the expected vibrancy of Asia's local demand story over the coming years. India and China combine for over 30 percent of the fund's weight. EMDD also features smaller allocations to Indonesia, Malaysia, Thailand and the Philippines.

For more on the emerging markets consumer, click <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/08/2858514/the-definitive-guide-to-em-consumer-etfs">here</a>.

Retail Sales

Econ #s

CHIQ

EMDD

Case For EM Consumer Bolstered by New Statistics

It has been a volatile year for India ETFs, and that is a kind assessment. 

Year-to-date, the iShares S&amp;P India Nifty 50 Index Fund (NASDAQ: <a class="ticker" href="/stock/indy#NASDAQ">INDY</a>), the WisdomTree India Earnings ETF (NYSE: <a class="ticker" href="/stock/epi#NYSE">EPI</a>) and the PowerShares India Portfolio (NYSE: <a class="ticker" href="/stock/pin#NYSE">PIN</a>) are sporting an average gain north of 14 percent. The downside of those gains is that investors have had to endure a roller-coaster ride on the way to the bank as <a href="http://www.etfreplay.com/charts.aspx">EPI and INDY</a> both have volatility metrics above 25 percent. PIN rests at 26 percent.

As is the case in many other emerging markets, a large part of the reason for India's underlying volatility is the country's government and its role in day-to-day economic perceptions. After getting off to a fine start in the first quarter, India ETFs such as EPI, INDY, PIN and others tumbled on speculation the country was primed to <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/06/2658878/india-one-foot-out-the-door-of-the-brics-house-epi-pin-s">lose its already tenuous investment-grade credit rating</a>.

At BBB- on the Standard &amp; Poor's ratings scale, India has the lowest credit rating of the four the BRIC nations. In April, S&amp;P lowered its outlook on that rating to negative prompting some analysts and investors to say the government in Asia's third-largest economy had turned a blind eye to the country's economic woes.

Investors' fears would later be somewhat assuaged when the government once accused of doing nothing to bolster its economy and foreign investment gave investors reason to cheer. India ETFs would soar for most of the third quarter after the government unveiled an <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/10/2982947/indias-government-investors-new-best-friend">array of economic reforms</a> aimed at stimulating growth and investment.

Those reforms included opening India's massive insurance and retail sectors to additional foreign investment, reduction of the country's punitive diesel subsidy and the injection of added liquidity into the banking system. 

Those headlines were enough to lift the fortunes of <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/3024332/aum-totals-soaring-for-india-etfs">India ETFs and not just the well-known fare</a> such as the aforementioned funds. The EGShares India Small Cap ETF (NYSE: <a class="ticker" href="/stock/scin#NYSE">SCIN</a>), the EGShares India Infrastructure ETF (NYSE: <a class="ticker" href="/stock/inxx#NYSE">INXX</a>) and other India funds benefited from the government reforms.

Fast-forward to today and government that oversees the world's largest democracy is once again likely to have a heavy hand in near-term returns to India ETFs. India is grappling to keep its fiscal deficit to 5.3 percent of GDP in a bid to keep its investment-grade rating. The country is looking to pare the deficit 0.6 percent annually for the next five years, <a href="http://www.bloomberg.com/news/2012-11-24/india-pledges-to-cut-deficit-cap-debt-to-avert-downgrade.html">Bloomberg reported</a>.

Whether or not traders are pricing in a credit downgrade for India can be debated, but what can not be debated is that the yield's on Indian 10-year sovereign bonds touched a two-month high earlier this month. The spread between those bonds and the comparable U.S. Treasuries is about 650 basis points.

Despite the size of its economy, India is not nearly the bond issuer, either at the sovereign or corporate level, that China is. At the ETF level, that translates to small weights in some of the marquee emerging markets debt ETFs, meaning investors can get some exposure to Indian bonds without being excessively exposed to a potential credit downgrade. For example, the WisdomTree Asia Local Debt Fund (NYSE: <a class="ticker" href="/stock/ald#NYSE">ALD</a>) allocates less than 5.7 percent of its weight to India and that is one of the larger weights to Indian government debt offered by any U.S.-listed ETF.

Remembering that failing to prepare is preparing to fail, investors can prepare for the worst-case India scenario. That being that the country sees its credit rating moved to junk status. Assuming that happens, ETFs with large exposure to high-beta sectors such as financials and energy could be vulnerable in the near-term.

Avoiding financials with Indian large and small-cap ETFs can be tricky as the sector is often the largest in both types of funds, so focusing on India's domestic demand story could prove to be the winning bet. It does not get much attention, bu the EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>) is the best-performing India ETF year-to-date with a gain of nearly 41 percent. Roughly 53 percent of INCO's weight is devoted to makers of personal goods, food and beverages which is to say the ETF is not a play on what Indian consumers, but rather on what they need.

Despite its almost 26 percent weight to financial services names, the newly minted iShares MSCI India Small Cap Index Fund (BATS: SMIN) merits consideration as well. Nearly 24 of that fund is directly exposed to the consumer and another 19 percent goes to health care and utilities names, so SMIN is not ultra-risky at the sector level. 

There is one more new ETF that is worth a look even if India heads to junk status. The EGShares Emerging Markets Domestic Demand ETF (NYSE: <a class="ticker" href="/stock/emdd#NYSE">EMDD</a>) focuses solely on companies that are levered to the domestic demand stories in various emerging markets. That means a couple of important things. First, U.S. multinationals such as Coca-Cola (NYSE: <a class="ticker" href="/stock/ko#NYSE">KO</a>) are not included in this ETF. Second, India merely accounts for 15.3 percent of EMDD's weight, so there is adequate coverage for investors should Indian stocks decline.

Of course, it is worth noting India and China combine for about 30 percent of EMDD's weight and that is important because the two countries could have combined <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/2965345/prepare-for-chindias-consumer-spending-surge-with-etfs">consumer spending of $10 trillion annually by 2020</a>.

For more on India ETFs, click <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/09/2940097/after-a-rough-patch-india-garners-bull-calls">here</a>.

Once Again, Government Has India ETFs at Crossroads 

The rebound in Indian equities fueled by government action to loosen restrictions on foreign investment caught plenty of investors off guard. After Standard &amp; Poor's lowered its outlook on <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/06/2658878/india-one-foot-out-the-door-of-the-brics-house-epi-pin-s">India's credit rating to negative from stable</a> in April, investors fled stocks in Asia's third-largest economy, punishing India ETFs in the process.

When those funds started to bounce, prompting a <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/09/2940097/after-a-rough-patch-india-garners-bull-calls">series of bull calls</a> from noted analysts, some money managers were caught asleep at the wheel. The efforts of those managers to play catch up with the Indian stock market prompted surging inflows into India-specific ETFs.

Unexpected reforms announcement by the government have buoyed the recent returns of ETFs ranging from the WisdomTree India Earnings ETF (NYSE: <a class="ticker" href="/stock/epi#NYSE">EPI</a>) to the Market Vectors India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scif#NYSE">SCIF</a>). Many foreign institutional investors prefer ETFs such as EPI and SCIF as a way of tapping resurgent Indian stocks <a href="http://www.dnaindia.com/money/report_india-only-etfs-see-assets-swell-a-third_1755865">due to a perceived lack of liquidity in the country's equity market</a>.

All that means inflows to India ETFs have surged in recent months. Take the examples of EPI and one of its primary rivals, the PowerShares India Portfolio (NYSE: <a class="ticker" href="/stock/pin#NYSE">PIN</a>). In late May, EPI had just over $700 million in AUM while PIN had a little more than $300 million, <a href="http://www.indiaetfs.com/2012/05/wisdomtree-india-etf-besting-powershares">according to India ETFs</a>. 

As of October 23, EPI's AUM total had swelled to over $1 billion. PIN will start trading today with almost $386 million in AUM. In the past 90 days, EPI and PIN are up 12.3 percent and 10.8 percent, respectively.

Interestingly, valuations on some India ETFs remain compelling. WisdomTree re-balanced the India Earnings Index, the index EPI tracks, in late September and that<a href="http://www.benzinga.com/news/earnings/12/10/2983633/are-these-etfs-too-cheap-to-ignore#ixzz2AIAJ9IXn">dragged the index's P/E down to 8.8</a>. PIN's P/E ratio at the end of September was 14.85, indicating the fund is cheaper on that basis than the iShares MSCI Brazil Index Fund (NYSE: <a class="ticker" href="/stock/ewz#NYSE">EWZ</a>).

Robust inflows to India-specific ETFs have not been exclusively reserve for EPI and PIN. The iShares S&amp;P India Nifty 50 Index Fund (NASDAQ: <a class="ticker" href="/stock/indy#NASDAQ">INDY</a>) has seen its AUM total steadily rise since late 2011. At that time, INDY had $225 million in AUM. At the close of U.S. markets on Wednesday, that number was almost $294 million.

There are obstacles and surprises, though. Obstacles loom in the form of catalysts, or lack thereof. Money has started trickling out of India ETFs in recent weeks as some investors view the funds as overbought and in need of a spark to continue moving higher. That spark could be an interest rate cut from the Reserve Bank of India, but there are no guarantees on that front.

Surprises include the fact that the EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>) and the EGShares India Infrastructure ETF (NYSE: <a class="ticker" href="/stock/inxx#NYSE">INXX</a>), two of the best-performing India ETFs over the past 90 days, have not seen much in the way of inflows, <a href="http://www.indexuniverse.com/data/etf-fund-flows-tool.html?task=showETFFlowsData">according to Index Universe data</a>.

Another issue is how foreign institutional investors choose to access India. Given the country's small weight in some benchmark global indexes (India represents less than seven percent of the MSCI Emerging Markets Index), some investors prefer to access India through a multi-country emerging markets ETF such as the iShares MSCI Emerging Markets Index Fund (NYSE: <a class="ticker" href="/stock/eem#NYSE">EEM</a>) rather than with India-specific funds.

In part, India's small weight in broader global indexes explains why India-specific ETFs trail some China funds in terms of AUM. The AUM totals for EPI, INDY and PIN could be added, then tripled and the resulting number would still trail the iShares FTSE China 25 Index Fund's (NYSE: <a class="ticker" href="/stock/fxi#NYSE">FXI</a>) assets by about $900 million.

Perhaps that implies India ETFs have room for growth. If the government can execute recently announced firms to the country's fullest advantage while bolstering infrastructure, then India ETFs could be compelling long-term bets.

For more on India ETFs, click <a href="http://www.benzinga.com/news/12/09/2946361/mobius-chimes-in-on-india">here</a>.

AUM Totals Soaring For India ETFs

Rare is the government that actually helps investors. Be it intentionally or unintentionally, many policymakers around the globe have shown a tendency to roil financial markets. An argument can be made that the bigger the government (think the U.S., China and developed Europe), the heavier the hand of government interference is in financial markets.

India, the world's largest democracy, is starting to do things differently. Earlier in 2012, Standard &amp; Poor's lowered its outlook on India's sovereign credit rating to negative from stable, <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/06/2658878/india-one-foot-out-the-door-of-the-brics-house-epi-pin-s">citing deteriorating economic fundamentals</a>. 

A large part of the problem with India, and a major contributing factor to Indian equities and ETFs, has been a government that foreign investors have viewed as turning its back on the countries economic woes. Those problems include inflation and infrastructure that can be described as decrepit at best.

Already home to the lowest credit rating, BBB-, of the BRIC countries and grappling with faltering stock prices, India's government has recently taken steps to garner favor with foreign investors. In short, Indian policymakers have reduced the country's punitive diesel subsidy, opened the insurance and retail sectors to more foreign investment <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/09/2940097/after-a-rough-patch-india-garners-bull-calls">while injecting more liquidity into the banking system</a>.

"I was pleased to see that the Indian government took significant steps in mid-September to strengthen the economy and encourage foreign investment into India," WisdomTree Research Director Jeremy Schwartz said in a research note. "In my opinion, these new policies have already started improving sentiment toward India, which was reflected in India's ranking as the best-performing country in the MSCI Emerging Markets Index in September."

The impact of India's reforms on its equity market have been palpable. In the past month, the iShares S&amp;P India Nifty 50 Index Fund (NYSE: <a class="ticker" href="/stock/indy#NYSE">INDY</a>), the WisdomTree India Earnings Fund (NYSE: <a class="ticker" href="/stock/epi#NYSE">EPI</a>) and the PowerShares India Portfolio (NYSE: <a class="ticker" href="/stock/pin#NYSE">PIN</a>) are up an average of 9.7 percent. That is better than triple the gain posted by the iShares MSCI Emerging Markets Index Fund (NYSE: <a class="ticker" href="/stock/eem#NYSE">EEM</a>).

It is now fair to classify India ETFs as "resurgent" after the funds were damaged by negative sentiment earlier this year.

"Earlier this year, the Indian government proposed a series of tax measures, including General Anti-Avoidance Regulations (GAAR), that would have a significant impact on foreign investors," said Schwartz. "This hurt sentiment toward India; and given the widespread criticism of this proposal, the prime minister established an expert committee to review the application of GAAR. The committee made various recommendations, including deferring the implementation of GAAR by three years and grandfathering existing investments, among other things."

India's efforts to open its burgeoning retail sector could be a boon for funds such as as the EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>). INCO is the only ETF exclusively devoted to the Indian consumer. With INCO up 40 percent year-to-date, it might be fair to say <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/2965345/prepare-for-chindias-consumer-spending-surge-with-etfs">the market is pricing in an anticipated surge in Indian consumer spending</a>.

As far as the impact of other reforms on India ETFs, the opening of the country's insurance sector to more foreign direct investment is going overlooked. India's insurance industry is worth an estimated $41 billion, but coverage penetration is poor at just 4.4 percent of the population in life, and 0.71 percent in non-life business, <a href="http://www.smetimes.in/smetimes/in-depth/2012/Oct/08/india-s-reforms-go-beyond-face-value627975.html">according to the SME Times</a>.

Any positive sentiment toward Indian financial services firms should benefit EPI. EPI, frequently viewed as the marquee India ETF because it is home to over $1 billion in assets under management, allocates over 25 percent of its weight to financial services firms. 

For more on India ETFs, click <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/09/2940097/after-a-rough-patch-india-garners-bull-calls">here</a>.

Analyst Color

Politics

General

India's Government: Investors' New Best Friend 

The emerging markets consumer has been a compelling, yet flummoxing theme for investors -- the allure of newly affluent (and soaring numbers of) new entrants to the middle class in the emerging world is alluring. ETF sponsors have met that demand with <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/08/2858514/the-definitive-guide-to-em-consumer-etfs">an array of multi-country and country specific products</a>.

All that said, the emerging markets consumer has not been a guaranteed winner for investors. For example, one well-known ETF offering exposure to the Chinese consumer is off 19.4 percent since its debut nearly three years ago.

For investors looking to dip their toes into some emerging markets consumer ETFs, a good news has arrived. A study by Boston Consulting Group shows consumer spending in China and India is expected to reach a combined $10 trillion per year by 2020, <a href="http://www.moneycontrol.com/news/business/china-india-consumer-spending-to-triple-by-2020_764115.html">according to Reuters</a>.

In the years leading up to 2020, Boston Consulting predicts consumers in China and India will spend a combined $64 trillion, Reuters reported. Growing middle classes in China and India, Asia's largest and third-largest economies, respectively, are expected to drive the consumer spending boom. Investors can prepare for the trend with the following ETFs.

EGShares Emerging Markets Consumer ETF (NYSE: <a class="ticker" href="/stock/econ#NYSE">ECON</a>)
The EGShares Emerging Markets Consumer ETF is arguably the gold standard when it comes to emerging markets consumer-focused funds. Since this is an emerging markets fund, it is bound to be more volatile than a comparable U.S.-focused ETF. However, it should be noted that ECON is more allocated toward staples equities such as food, beverage and tobacco producers, not consumer discretionary.

However, ECON only features a 10.5 allocation to India <a href="http://www.emergingglobaladvisors.com/econ.cfm">and no exposure to China.

Global X China Consumer ETF (NYSE: )
Investors looking for Chinese exposure might consider CHIQ, one of the more quiet ETFs with over $100 million in assets under management (it has almost $111 million in AUM). This is the fund referenced earlier that has lost 19 percent since inception.

On the upside, CHIQ is the </a><a href="http://www.benzinga.com/trading-ideas/long-ideas/12/07/2751264/4-etf-laggards-poised-for-upside-chiq-pnqi-xle">most direct route to the China consumer and the ETF is shedding its laggard status</a>. As was predicted several months ago, CHIQ was poised for some upside and the ETF has delivered, soaring almost 6% in the past month.

The EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>)
Just as CHIQ in the world of China ETFs, INCO is an often forgotten member of <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/09/2927355/koesterich-upgrades-india-to-neutral-from-underweight">India ETF universe</a>. Perhaps that will change with if Boston Consulting's forecasts prove accurate.

INCO shares an important trait in common with ECON and that is the ETF is much more heavily exposed to staples than discretionary names. INCO is by no means the Consumer Staples Select Sector SPDR (NYSE: <a class="ticker" href="/stock/xlp#NYSE">XLP</a>) in terms of being boring. 

Then again, that might be a good thing and INCO might be telling investors the Indian consumer is already perking up. On the basis that stocks and ETFs are forward-looking assets, INCO's 41.3 percent year-to-date gain could be foreshadowing increased strength in Indian consumer trends going forward.

First Trust ISE Chindia Index Fund (NYSE: <a class="ticker" href="/stock/fni#NYSE">FNI</a>)
The First Trust ISE Chindia Index Fund presents a useful option for investors on two levels. First, it eases the burden of picking between China and India. Second, the fund is not a full commitment to the consumer. FNI offers scant staples exposure, but discretionary names account for almost 23 percent of the fund's weight. 

FNI's largest holding holding is not a Chinese or Indian company. That honor goes to high-end handbag maker Michael Kors (NYSE: <a class="ticker" href="/stock/kors#NYSE">KORS</a>), which represents 8.7 percent of FNI's weight.

For more on emerging markets consumer ETFs, click <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/10/2953265/under-the-hood-tilting-toward-emerging-markets">here</a>.

Prepare For Chindia's Consumer Spending Surge With ETFs

The chorus of endorsements for Asia's third largest economy in India, is growing louder. In a new blog post, legendary emerging markets investor Dr. Mark Mobius, executive chairman of the Templeton Emerging Markets Group, said his team sees growth potential in the Indian economy.

Perhaps it is just a coincidence, but the <a href="http://mobius.blog.franklintempleton.com/2012/09/26/brics-economic-growth/?nicamp=other&amp;nichn=markmobius&amp;nismseg=twitter_brics">post was published yesterday</a> and India ETFs are moving higher today. For example, the WisdomTree India Earnings ETF (NYSE: <a class="ticker" href="/stock/epi#NYSE">EPI</a>) is up more than two percent while the Market Vectors India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scif#NYSE">SCIF</a>) is higher by 2.5 percent.

The catalysts for the recent bullishness in Indian equities have been noted by other analysts and investors and Mobius cites some familiar ones in highlighting favorable actions taken by the Indian government. Those reforms include "plans to divest its stake in five companies, a shift away from subsidies, and the opening of foreign direct investment in power exchanges, the non-news broadcast media, retailing and aviation industries," Mobius wrote.

Those actions by the government have certainly helped Indian ETFs. In the past month, the iShares S&amp;P India Nifty 50 Index (NASDAQ: <a class="ticker" href="/stock/indy#NASDAQ">INDY</a>) is up 11.4 percent while EPI is higher by nearly 12 percent. SCIF has surged 16 percent.

In terms of opening the retail sector more foreign direct investment, the unheralded EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>) has continued a run that has seen the ETF outperform almost every other member of the India ETF complex. INCO, <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/04/2495923/3-etfs-for-akshaya-tritiya-gld-inco-inxx">which did receive some praise earlier this year</a>, is up almost 14 percent in the past month and 35 percent year-to-date.

Again, it is probably just a coincidence, but the ETF is higher by 3.3 percent today following the Mobius post. 

What is noteworthy about the Mobius call on India is that he is at least the third voice to extol the virtues of India in the past week. Earlier this week, WisdomTree Research Director Jeremy Schwartz <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/09/2940097/after-a-rough-patch-india-garners-bull-calls">praised India's new policy measures</a> in a favorable research note on the country.

Last week, iShares Global Chief Investment Strategist Russ Koesterich <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/09/2927355/koesterich-upgrades-india-to-neutral-from-underweight">upgraded India to Neutral from Underweight</a>. Naysayers could argue that Koesterich and Schwartz have skin in the game because their firms sponsor some of the largest India ETFs. 

Perhaps that is being overly critical, but it is worth noting the Templeton BRIC Fund managed by Mobius <a href="https://www.franklintempleton.com/retail/app/product/views/fund_page.jsf?fundNumber=405&amp;view=portfolio">is not excessively weighted to India</a>. Nor is the Templeton Emerging Markets Balanced Fund, <a href="https://www.franklintempleton.com/retail/app/product/views/fund_page.jsf?fundNumber=080&amp;view=portfolio">also managed by Mobius</a>.

Something else that must be acknowledged about Indian stocks is that, despite a tumultuous year, the market is the king of the BRIC quartet in terms of performance. At least as measured by the marquee ETFs tracking each nation. EPI is up 21.1 percent year-to-date, better than twice the returns offered by the Market Vectors Russia ETF (NYSE: <a class="ticker" href="/stock/rsx#NYSE">RSX</a>), the largest ETF. The largest Brazil and Chna ETFs, the iShares MSCI Brazil Index Fund (NYSE: <a class="ticker" href="/stock/ewz#NYSE">EWZ</a>) and the iShares FTSE China 25 Index Fund (NYSE: <a class="ticker" href="/stock/fxi#NYSE">FXI</a>), are both in the red on the year.

The China/India rivalry has been noted too many times to count since the term BRIC was coined over a decade ago, but India might someday come out on top.

"Despite its obstacles, India's economy has proved adept at generating growth in recent years without heavy investment and with a much better ratio of growth to capital spending than China," Mobius wrote. "Unlike in China, India's working population is generally expected to experience strong growth over the next decade, and reserves of labor among the rural population are large. The impediments to continued growth should be surmountable, in our opinion, provided the political will is there—which leads us to believe in the economy's growth potential."

For more on India ETFs, click <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/09/2940097/after-a-rough-patch-india-garners-bull-calls">here</a>.

Management

Mobius Chimes in on India

After a precipitous decline that started late in the first quarter, Indian equities and many of the corresponding ETFs have rebounded in recent weeks. The move higher has prompted at least one upgrade of Asia's third-largest economy as iShares Global Chief Investment Strategist Russ Koesterich raised his rating on India from Underweight to Neutral.

Koesterich advocated an Underweight rating on India on February 6. At the time, the call appeared early as major India ETFs including the WisdomTree India Earnings ETF (NYSE: <a class="ticker" href="/stock/epi#NYSE">EPI</a>) and the iShares S&amp;P India Nifty 50 Index Fund (NASDAQ: <a class="ticker" href="/stock/indy#NASDAQ">INDY</a>) and others continued a torrid pace set at the start of the year, rallying into early March.

The call proved prescient as EPI and INDY have lost 11.6 percent and 7.6 percent, respectively since February 6. Indian small caps have been even worse offenders. Since February 6, the Market Vectors India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scif#NYSE">SCIF</a>) has plunged 20 percent while the rival EGShares India Small Cap ETF (NYSE: <a class="ticker" href="/stock/scin#NYSE">SCIN</a>) is off 12.5 percent.

The aforementioned ETFs and others tracking the "I" in BRICS have started to turn around. Now, foreigners are gobbling up Indian equities. Offshore funds purchased a net $522.1 million of Indian shares on Sept. 14, the highest level in ten weeks, <a href="http://www.businessweek.com/news/2012-09-17/foreigners-buy-most-indian-equities-in-two-months-on-refo">Bloomberg reported, citing the Securities &amp; Exchange Board of India</a>.

In a blog post, <a href="http://isharesblog.com/blog/2012/09/19/4-reasons-why-we%E2%80%99re-upgrading-india/">Koesterich outlines several reasons for the India upgrade</a>. He notes that India reported solid second-quarter GDP growth of 5.5 percent. 

"We've also upgraded our view on India's growth," Koesterich said. "Our new forecast projects 6.4 percent annual growth in GDP, up from 6.1 percent." 

Improved growth in the medium term could be buoyed by reduced diesel subsidies, looser rules on foreign ownership in India's retail sector and "aggressive growth target from India's planning commission: 8.2 percent from 2012 through 2017, surpassing the 7.9 percent target achieved over previous five years."

Loosening of investing restrictions in India's retail sectors could be a boon for ETFs such as the EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>). Thinly traded <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/08/2816436/3-more-india-etfs-your-broker-forgot-to-mention">and often forgotten in the India ETF conversation</a>, INCO is the only ETF focused entirely on the Indian consumer. 

INCO has found a way to hold up well among the India ETF carnage. In the past six months, the fund has jumped seven percent while EPI has lost 7.4 percent. SCIF has plunged 17.4 percent over the same time. 

India's macroeconomic struggles this year – inflation and slowing growth chief among them – have made the operating environment tricky for established and new ETFs alike. iShares rolled out two new India ETFs in February BEFORE Koesterich shifted his rating to Underweight. In April, Standard &amp; Poor's <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/06/2658878/india-one-foot-out-the-door-of-the-brics-house-epi-pin-s">lowered its outlook on India's credit rating to negative from stable</a>. India sports a BBB- minus credit rating from S&amp;P, the lowest investment grade rating and the lowest credit rating among the BRIC quartet. 

The two new iShares India ETFs, the iShares MSCI India Index Fund (BATS: INDA) and the iShares MSCI India Small Cap Index Fund (BATS: SMIN) have attracted less than $25 million in assets under management combined. However, those INDA and SMIN have participated in the India rebound, rising 6.8 percent and 5.5 percent, respectively, over the past month.

Despite the recent ebullience surrounding India ETFs, Koesterich's Neutral rating on the country is arguably appropriate given the macro uncertainty still surrounding the country and he acknowledges in the blog post that a move to a bullish view is somewhat far off. 

"High inflation, together with the weak rupee, limit the scope for future rate cuts, which could stimulate the economy," Koesterich wrote. "Fiscal and current account deficits have been persistent, and policy making is slow and at times erratic. This hinders the follow-through that we would like to see in implementing structural reforms. But in the meantime, we would now favor a neutral, or benchmark position in Indian equities."

For more on India ETFs, click <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/08/2816436/3-more-india-etfs-your-broker-forgot-to-mention">here</a>.

Koesterich Upgrades India to Neutral From Underweight

Not surprisingly, emerging markets investing long ago went mainstream and one byproduct of that has been a growing curiosity about consumers in developing nations. Over the past several years, Western investors have been inundated with media accounts about the new rich in markets ranging from China to India to Brazil. 

Rankings of per capita GDP derived from purchasing power parity highlight just how frustrating playing the emerging markets consumer can be for investors. Of the BRIC nations, Russia looks good by comparison ranking 57th in the world last year in terms of per capita GDP. On the other hand, India's rank of 136th doesn't look so good.

Despite the vexing proposition that is the emerging markets consumer, ETF issuers <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/08/2836992/under-the-hood-internally-focused">have continued to bring funds to market</a> that focus on this theme. 

Here is the definitive guide to such ETFs:

EGShares Emerging Markets Consumer ETF (NYSE: <a class="ticker" href="/stock/econ#NYSE">ECON</a>)
The EGShares Emerging Markets Consumer ETF can be viewed as the ETF that started it all when it comes to ETF plays on consumers in developing nations. Just a few weeks shy of its second birthday, ECON now has over $420 million in assets under management. 

A knock on ECON is that it has only returned 6.4 percent this year, a performance that trails more noteworthy multi-country funds such as the Vanguard MSCI Emerging Markets ETF (NYSE: <a class="ticker" href="/stock/vwo#NYSE">VWO</a>). That said, there are some nifty aspects to ECON. 

For starters, the fund's sector weightings are not focused on discretionary spending. With beverage names and food and drug retailers accounting for 31 percent of ECON's weight, the bias here is clearly toward staples. A combined 17 percent allocation to food and tobacco names cements the fund's staples bias. 

Oddly enough, ECON features no exposure to China. In fact, India and Malaysia are ECON's only Asian country weights. Mexico, Brazil and Chile combine for over 47 percent of ECON's weight. The almost 20 percent allocation to Mexico could serve ECON well going forward as some <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/08/2822061/mobius-chimes-in-on-mexico">well-known investors</a> have recently been touting the consumer story in Mexico.

iShares MSCI Emerging Markets Consumer Discretionary Sector Index Fund (NASDAQ: EMDI)
ECON has a pseudo rival in the form of newly minted EMDI, though the iShares offering has lead an anonymous existence since its February debut. The knocks on EMDI are obvious. It has only attracted $2.4 million in AUM since coming to market and average daily volume of just over 400 shares is bound to chase some investors away.

At the country level, the fund is dominated by South Korea and South Africa, which represent almost 52 percent of EMDI's weight. China, Brazil and India round out EMDI's top-five country weights. EMDI has tumbled 8.2 percent this year.

EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>)
The EGShares India Consumer ETF is one of three country-specific emerging markets consumer ETFs on the market today. INCO, which recently celebrated its first birthday, leads an anonymous existence to the point that some analysts <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/03/2423545/do-these-etfs-dont-deserve-the-warning-label-inco-and-pjb">have speculated the fund will not be around forever</a>. 

That is a tough call to make, especially when INCO has gained 20.3 percent year-to-date. INCO shares two important things in common with ECON. First, it is pricey. In the case of INCO, that means annual fees of 0.89 percent. Second, INCO is more allocated to the <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/02/2336146/4-etfs-with-surprising-conservative-sector-allocations">conservative end of the consumer spectrum</a>. 

Translation: Personal goods and food names represent 41 percent of INCO's weight while beverage and tobacco stocks chip in another 17 percent.

Global X China Consumer ETF (NYSE: <a class="ticker" href="/stock/chiq#NYSE">CHIQ</a>)
With scores of new millionaires and some new billionaires, China has often been viewed as the prime example of just how compelling the emerging markets consumer theme can be for foreign investors. CHIQ has certainly benefited from that theme by attracting $109.3 million in AUM debuting in November 2009. 

CHIQ is home to 40 stocks and its valuation metrics do not imply a richly valued fund. The ETF's price-to-earnings ratio is currently 14.7 and its price-to-book ratio is 1.47, <a href="http://www.globalxfunds.com/CHIQ">according to Global X data</a>. 

CHIQ's performance relative to the iShares FTSE China 25 Index Fund (NYSE: <a class="ticker" href="/stock/fxi#NYSE">FXI</a>), the largest China ETF, is interesting. Year-to-date, FXI is the clear winner. Over the past month as risk appetite has increased somewhat, CHIQ has topped FXI by over 300 basis points.

Global X Brazil Consumer ETF (NYSE: <a class="ticker" href="/stock/braq#NYSE">BRAQ</a>)
In a year in which larger, more well-known <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/08/2835946/is-a-bridgewater-bottom-in-for-ewz">Brazil ETFs have struggled</a>, BRAQ has been a source of strength for investors looking to be involved with Latin America's largest economy. 

BRAQ turned two-years-old in July, but it is nowhere near the size of CHIQ with just $22.8 million in AUM. However, BRAQ has one important factor in its favor. Over the past year, year-to-date, the past six months and the past three months, BRAQ has easily outperformed the iShares MSCI Brazil Index Fund (NYSE: <a class="ticker" href="/stock/ewz#NYSE">EWZ</a>), the largest Brazil ETF. 

BRAQ is more of a mid-cap play as the average market capitalization of its constituents is about $3.8 billion. That is not a bad thing as it means BRAQ avoids exposure to struggling Brazilian large-caps such as Petrobras (NYSE: <a class="ticker" href="/stock/pbr#NYSE">PBR</a>) and Vale (NYSE: <a class="ticker" href="/stock/vale#NYSE">VALE</a>).

EGShares Emerging Markets Domestic Demand ETF (NYSE: <a class="ticker" href="/stock/emdd#NYSE">EMDD</a>)
The EGShares Emerging Markets Domestic Demand ETF is the <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/08/2836992/under-the-hood-internally-focused">new kid on the block among emerging markets consumer funds</a>. EMDD debuted just last week so it is not yet fair to judge the fund on its AUM and volume metrics.

However, the new ETF does offer up an interesting way of playing developing world consumers. That is a focus on internal consumption. A large part of the allure of emerging markets is the export stories that drive many of these economies. That is a great story when global growth is not slowing. Global growth is slowing today and that puts a premium on finding emerging markets that either have <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/06/2654911/time-to-power-up-with-poland-epol-plnd">strong internal consumption trends</a> or are trying to get there. 

Mexico accounts for almost 25 percent of EMDD's and as was noted earlier, investors are starting to warm to that country's consumer stories. Some of EMDD's small country weights such as Indonesia and Malaysia are seeing improving domestic demand trends. 

China, India, South Africa and Brazil combine for 55 percent of EMDD's weight. That presence is obviously significant and it implies EMDD will need at least two of those four nations to see improved economic trends sooner than later to help drive the new fund's returns.

For more on emerging markets ETFs, click <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/08/2855821/under-the-hood-beyond-bric">here</a>.

VALE

The Definitive Guide to EM Consumer ETFs

Asia's third-largest economy India was once an emerging markets darling. More recently, the country is home to slowing economic growth, crumbling infrastructure, <a href="http://www.benzinga.com/analyst-ratings/analyst-color/12/06/2658878/india-one-foot-out-the-door-of-the-brics-house-epi-pin-s">a tenuous hold on an investment-grade credit rating</a> and a government that has been accused of doing nothing to address any of those issues.

However, India may still be teeming with profitable opportunities for savvy investors. For example, the country's <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/07/2792665/these-etfs-could-benefit-from-the-indian-blackout">infrastructure needs</a> could prove to be a valid investment thesis in the coming years. 

It might seem implausible that any ETF <a href="http://www.benzinga.com/trading-ideas/long-ideas/11/09/1950812/five-india-etfs-your-broker-forgot-to-mention">tracking India could lead an anonymous existence</a>. Yet that is the case with a few of the funds tracking this erstwhile emerging markets star.

Investors might do well to familiarize themselves with the following lesser-known India ETFs:

iShares MSCI India Small Cap Index Fund (BATS: SMIN)
The iShares MSCI India Small Cap Index Fund debuted in February, meaning the fund only caught the tail-end of the early 2012 run higher by India ETFs. In addition, SMIN entered an arena loaded with competition where the the EGShares India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scin#NYSE">SCIN</a>) and the Market Vectors India Small-Cap ETF (NYSE: <a class="ticker" href="/stock/scif#NYSE">SCIF</a>) were established as the top choices for investors looking for exposure to Indian small-caps.

Given that competition, investors may not be surprised that SMIN has struggled to attract assets. Still, it has a lower expense ratio than SCIN and SCIF. Moreover, SMIN has outperformed its two rivals over the past three months.

EGShares India Consumer ETF (NYSE: <a class="ticker" href="/stock/inco#NYSE">INCO</a>)
A consumer focus did not help the EGShares India Consumer ETF avoid the downdraft that hit the India space earlier this year. Investors may be growing tired of waiting for the emerging markets consumer theme to move from potentially to actually profitable. 

One notable characteristic of INCO <a href="http://www.benzinga.com/trading-ideas/long-ideas/12/04/2495923/3-etfs-for-akshaya-tritiya-gld-inco-inxx">is its sector allocations</a>. The fund offers some discretionary exposure but is heavy on staples. Personal goods and food stocks combine for 41 percent of the fund's weight. Beverage and tobacco names combine for another 16 percent. 

Risk with INCO is two-fold. The ETF is not heavily traded. Also, given the fund's exposure to food names, INCO would likely be vulnerable should inflation in India spike.

iShares MSCI India Index Fund (BATS: INDA)
As was the case with SMIN, INDA debuted in February and took on plenty of competition in the process. With $18.3 million in assets under management, INDA has been decent at attracting investors. But the fund still has far less assets than the WisdomTree India Earnings ETF (NYSE: <a class="ticker" href="/stock/epi#NYSE">EPI</a>) and the PowerShares India Portfolio (NYSE: <a class="ticker" href="/stock/pin#NYSE">PIN</a>). 

An ETF that faces as much established competition as INDA likely must stand out if to attract assets. INDA has done that by outperforming some of its larger rivals and by having a lower expense ratio than EPI and PIN.

For more on India ETFs, click <a href="http://www.benzinga.com/trading-ideas/long-ideas/11/09/1950812/five-india-etfs-your-broker-forgot-to-mention">here</a>.