Market Overview

ETFs For Valentine's Day


It may not be the favorite day of the year for most guys out there, but Valentine's Day carries with it a significant economic impact. The National Retail Federation estimates that Valentine's Day 2012 will contribute $17.6 billion to the U.S. economy. That's an almost 9% increase over the 2011 Valentine's Day spending figure.

Put another way, at $17.6 billion, Dow component Alcoa (NYSE: AA) could probably be bought and the buyer would still have some a few billion left over.

As we noted last year, Valentine's Day is an investable theme sort of, so let's update the list of ETFs relevant for the big day that might actually be worth a trade in the near-term.

iPath DJ-UBS Cocoa TR Sub-Index ETN (NYSE: NIB) Times change and they can change especially quickly when it comes to commodities ETNs. Last Valentine's Day, we were somewhat bullish on NIB as cocoa supply was being restrained by political upheaval in Ivory Coast. Back then, the ETF was trading in the high 40s. Today, it's below $30. Cocoa futures have rebounded in 2012, but NIB needs to cross the $31-$32 area to improve its technical outlook.

PowerShares Dynamic Food & Beverage Portfolio (NYSE: PBJ) While not always mentioned among the top tier of conservative ETF ideasPBJ's lineup is heavy on staples names, making it an ideal low-beta play. With a combined 10% allocation to Kraft (NYSE: KFT) and Hershey (NYSE: HSY) the ETF is a legitimate Valentine's Day play as well. Upside from current levels could be 5% or more.

Consumer Discretionary Select Sector SPDR (NYSE: XLY) Home to 80 stocks, XLY has some Valentine's Day shopping destinations among its holdings, particularly when one move's beyond the ETF's top-10 holdings. Of that group, only Amazon (Nasdaq: AMZN) and maybe one or two other names might be places to buy a gift for your sweetie. Move down the list and holdings like Coach (NYSE: COH) and Tiffany (NYSE: TIF) give XLY a Valentine's Day feel. XLY is flirting with a new 52-week high today and has been one of the better Select Sector SPDRs to start 2012.

Technology Select Sector SPDR (NYSE: XLK) Seriously? Indeed. Check out these factoids from the National Retail Federation. "More than half of all tablet owners (53.8%) will use their device to research products, compare prices, redeem coupons, look up retailer information or purchase products. Four in 10 (40.4%) smartphone owners will use their mobile device to do the same."

Regardless of Valentine's Day, XLK is a fine idea for those looking to get exposure to Apple (Nasdaq: AAPL) without shelling out $500 per share. That stock accounts for almost 16.5% of XLK's weight, but the ETF trades for less than $29.

ETFS Physical Platinum Shares (NYSE: PPLT) Any of the physical metal ETFs would be appropriate and last year we picked the SPDR Gold Shares (NYSE: GLD). The National Retail Federation is forecasting that 19% of Valentine's Day purchases will involve jewelry, but PPLT gets the nod because platinum has outperformed gold by a fair margin this year.

Posted-In: Long Ideas News Sector ETFs Short Ideas Specialty ETFs Futures Commodities Events Best of Benzinga


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