ETF Plays For Research In Motion Earnings/Guidance

Alright, you know the story by now: Blackberry maker Research In Motion RIMM got rocked yesterday after the close when the company issued weak fiscal first-quarter guidance and noted that profit margins would be crimped as it introduces its new tablet device, the Playbook. If you want an ETF playbook on how to play the disaster that is RIM's guidance, you've come to the right place, but the answers might surprise you. You could opt for, and this might be the most prudent choice, going long the ProShares UltraShort QQQ QID in anticipation that the Nasdaq will suffer at the hands of the RIM news. The only problem is that RIM only accounts for 1.55% of the PowerShares QQQ QQQ. Traders/adrenaline junkies could take a look at the Wireless HOLDRs WMH, the ETF with the biggest weighting to RIM at over 10%, but be warned: WMH might be a tricky short with average volume of less than 400 shares a day. On that note, shorting the iShares S&P North America Tech-Multimedia Network Index Fund IGN might make more sense. RIM has a weighting of almost 8.6% in this ETF and liquidity isn't an issue here. Another option to consider is the newly minted First Trust NASDAQ CEA Smartphone Index Fund FONE, which has certainly been subject to plenty of fanfare, but again could be a disappointment as RIM proxy because while RIM is FONE's seventh-largest holding at 2.65% that weight may not be enough to make a difference in an ETF that tracks over 70 stocks, none with an allocation of over 2.7%.