Good Article

I found a good article from BusinessWeek Europe via Yahoo Finance about ETFs and the move to narrower themes in the product lines offered by the various providers.

When I put the post up about the new iShares funds the other day, I had some comments left about what I had in mind about useful.

A lot of the new funds are different versions of ETFs that already exist. There are other homebuilder ETFs, another insurance ETF, another aerospace ETF and so on. The new ones being created might be better than the ones that already exist but a lot of the me too products will not have much differentiation.

This is not a negative thing. I have said before that in bringing useful new products to the market there will be some that aren't so hot.

The new gold miner's ETF in the works from Van Eck is a concept that makes sense. I imagine there will be one or two other mining ETFs that will come along. One may be better than the others, assuming more than one does come. The idea of splitting gold exposure between GLD and a miner ETF is very appealing to me.

The first two bio-tech ETFs had big flaws. BBH is hugely overweight two stocks and IBB (client holding) is only Nasdaq. The third entrant, from PowerShares, had far fewer flaws. There is a new one from StateStreet that I have not studied yet that could be better or could be worse.

On March 31 I poked a little fun at the Ferghana-Wellspring proposed line up of narrow based health-related ETFs but they could turn out to be the best choice for bio-tech.

The point here is that there will be a lot of new product and part of your job of managing your portfolio (if you use or have any interest in using ETFs) is to stay reasonably current on what is happening with new ETFs.