Dion Money Management Blog   Money Management for Retirees and Their Families

Welcome to Don Dion’s Daily ETF Winners and Losers. Be sure to stop by each day to get a feel of who’s winning and who’s losing when it comes to ETFs.

Winners

Market Vectors Vietnam ETF (VNM) 4.0%
Vietnam’s marketplace is scoring gains, pushing VNM to industry-leading strength and breaking the fund’s eight-day string of losses.

This frontier nation ETF’s descent has been sharp and steep. Looking to the days ahead, it will be interesting to see if it can recover some ground.

Other Asia-related ETFs are trudging higher as well. The iShares MSCI South Korea Index Fund (EWY) is up 1.7%.

SDPR S&P Retail ETF (XRT) 1.6%
A strong earnings showing from Tiffany & Co (TIF) providing XRT with fuel needed to push higher.

XRT’s upward action throughout the start of 2011 has been particularly impressive considering the looming concerns over rising commodity costs. I often turn to this fund as a strong option for investors looking to gain firsthand exposure to the consumer recovery.

iPath Dow Jones UBS Grains Subindex Total Return ETN (JJG) 1.2%
The agriculture sector is witnessing mixed action. As grains-backed funds like JJG and Teucrium Corn ETF (CORN) tread higher, the iPath Dow Jones UBS Cotton Subindex Total Return ETN (BAL) is taking one of the ETF industry’s biggest hits.

Despite this bipolarity, the PowerShares DB Agriculture Fund (DBA) is managing to carve out gains.

Losers

United States Natural Gas Fund (UNG) -1.8%
Natural gas prices are stumbling after the Energy Information Administration reported that fuel stockpiles grew by more than was expected.

Once again, the equity-based First Trust ISE Revere Natural Gas Index Fund (FCG) is proving to be a more stable option than futures-backed products like UNG. On Thursday, shares of FCG were up 0.4%.

iShares Silver Trust (SLV) -1.5%
The physically-based silver ETF is struggling against its 50-day moving average, snapping a three-day streak of gains.

The downward action witnessed from silver is weighing on the broad ETFS Physical Precious Metals Basket Shares (GLTR) . This fund, designed to track a combination of silver, gold, platinum and palladium is stuck in a downturn as well.

Guggenheim Solar ETF (TAN) -1.0%
The solar energy industry is taking a hit, leading TAN lower. This ETF has suffered losses on nine out of the past ten trading days. As a result of this tumble, the fund has retreated to new 2011 lows.

Given their inherently volatile nature, investors should approach TAN and any other alternative energy ETF with caution.

Disclaimer

The investing environment has been shaken by the bloody political protests in the Middle East and Northern Africa, Japan’s natural disasters, the commodities shakeup and most recently, the resurgence of the European debt crisis.

Although this rocky situation from these headwinds may prove too much to many, I advise against fleeing this marketplace at this time.

Rather, by making adjustments, it is possible for battered investors to weather current economic storms and prepare for clearer skies ahead.

In the face of these global challenges, I remain confident in the market’s recovery over the long run. However, as we work through this current bout of turbulence it may be in investors’ best interests to arm themselves with exposure to large, defensive industry goliaths such as General Electric (GE) , International Business Machines (IBM) , Chevron (CVX) and McDonalds (MCD) .

These companies tend to lack the same pop as small-, and mid-cap firms, and are often viewed as boring. However, their size, global reach, and liquidity will likely make them better suited for maintaining stability during periods of questionable market action.

Funds such as the SPDR Dow Jones Industrial Average ETF (DIA) will provide investors with exposure to wide collection of these companies.

Though on a long-term time scale, they continue to lag against small- and mid-cap equity indices by a comfortable margin, large-cap indices such as the Dow Jones Industrial Average have made big strides in recent weeks. In fact, over the most recent 90-day period, the DIA has actually managed to outpace products including the iShares Russell 2000 Index Fund (IWM) and the iShares S&P MidCap 400 Index Fund (MDY) .

In the coming weeks, it will be interesting to see if this gap further contracts as investors continue to seek out the protection of business heavyweights.

Large-cap ETFs like DIA may present as an appealing opportunity for some. However, another option investors may want to consider is a dividend-focused investing strategy.

Throughout the opening half of the year, we have watched as a number of well-known firms raise their dividends to draw down their massive cash reserves. Most recently, UnitedHealthGroup (UNH) announced a 30% dividend hike.

Consistent yields such as those offered by UNH will provide a welcomed sense of comfort during any type of market environment. While it is possible for investors to scour the marketplace looking for top dividend-paying companies, the ETF industry has done most of the work for us. By utilizing a product like iShares Dow Jones Select Dividend Index Fund (DVY) , it is possible to take on exposure to a basket of companies that have offered consistently high dividends over time.

Top DVY holdings include Lorillard (LO) , Chevron (CVX) and Entergy (ETR) . The fund’s yield currently stands at over 3%.

Investors have been greeted with an exhausting list of headwinds during the opening half of 2011 and as we continue ahead, many of these same factors will continue to dominate headlines. At times, the looming turmoil will appear too daunting, but I urge investors to avoid exiting the market entirely.

Rather, by homing in on ETFs aimed at large caps and dividend-paying equities, it is possible to build a strong defense that will protect against shakeups down the road.

Disclaimer

The Internet realm has been thrust into the spotlight following last week’s LinkedIn (LNKD)’s trading debut. While exciting to watch, investing in this industry could prove tricky in the weeks ahead.

Despite the rampant investor interest, clearly much remains unknown about firms like LNKD and Russia’s Yandex , which will take the stock symbol YNDX when it begins trading. Until the dust settles, it will be difficult to judge how they will perform. Already, in the aftermath following the LinkedIn’s explosive action late last week, many analysts and commentators have already begun to clamor over whether or not we are witnessing signs of a new dot-com bubble.

Given the swirling uncertainty, I caution against diving into any of these newly IPOed companies at this time. This does not mean, however, that investors should shun this corner of the tech sector entirely. On the contrary, ETFs with heavy focus on online firms may be well-positioned to benefit in the near term as interest in the Internet reaches a boiling point.

I have often pointed out the First Trust Dow Jones Internet Index Fund (FDN) as a strong option for investors looking for a unique way to target the technology sector over the long run. However, in the nearer term, this fund could also prove to be a safe way to profit as companies like LinkedIn stay on the forefront of investors’ minds.

Since it launched in 2006, FDN has been dedicated to providing investors with exposure to the most attractive companies in the Internet. Today, the fund’s index includes heavy exposure to large, online goliaths like Google (GOOG) , Amazon (AMZN) and eBay (EBAY) . While these companies comprise the largest slices of the fund’s portfolio FDN also sets aside a substantial portion of its assets for smaller players including Netflix (NFLX) and salesforce.com (CRM) .

Whereas companies like LinkedIn and Yandex will likely prove volatile in the near term as they work to solidify their places in the broader markets, the firms underlying FDN have already developed a substantial, dedicated following.

According to FDN’s website, companies considered for the Dow Jones Internet Index must have had at least three months of trading history. Additionally, during this period, the company must have an average capitalization of $100 million; an average closing price over $10; and adequate liquidity.

By requiring that these criteria be met prior to their inclusion into the index, FDN can better ensure that the companies comprising its portfolio will behave in a stable, reliable manner over time.

LinkedIn’s IPO has sparked heavy investor interest in the Internet industry and, looking forward, it will be exhilarating to see how it and fellow newcomers will perform. Given the wild excitement in this corner of the marketplace however, finding strong, stable ways to gain exposure over the short and mid-term may prove difficult.

With no exposure to LinkedIn or Yandex, FDN will not be directly influenced by the day-to- day performance of these hotly watched names. Rather, with exposure to weathered Internet veterans like Google and eBay, this fund will be best utilized by conservative investors looking to take advantage as general interest towards this region of the tech sector stays buoyed.

Disclaimer

Over the course of the week, investors and market commentators have been mulling over the 13F regulatory filings released by individuals including George Soros, Steve Cohen, John Paulson, and Warren Buffett.

These documents typically have provided plenty of interesting clues and insights into the current mindsets of these Wall Street notables.

According to the filing, Buffett made only minor adjustments to his legendary investment portfolio during the opening quarter of 2011. The most noticeable change was the addition of Mastercard (MA) . As of the end of March, Buffett’s stake in the credit card company totaled 216,000 shares. Aside from this new position, the investor also trimmed his stake in ConocoPhillips (COP) .

This is not the first time that Buffett has tapped into the credit card industry. On the contrary, American Express (AXP) is a long-standing Berkshire Hathaway (BRK.A) holding and is currently his third largest position, accounting for a more than 10% stake of the portfolio.

As noted by many, the decision to gain exposure to Mastercard is not surprising. Rather, the move can likely be traced back to Buffett’s newest hire, Todd Combs, a former hedge fund manager-turned-potential Buffett successor. Prior to joining Berkshire Hathaway, Comb’s hedge fund, Castle Point, held a large stake in the credit card company as well.

Buffett’s attraction to credit card companies like Mastercard and American Express can be viewed another play on the strength of the U.S. consumer. Throughout the slow and often arduous economic recovery, he has consistently maintained a bullish outlook for the United States.

Although financials represent the largest slice of Buffett’s portfolio’s sector breakdown, the Oracle of Omaha also boasts heavy exposure to companies that will be influenced by the consumer’s resurgence. Top portfolio components include Coca-Cola (KO) , Procter & Gamble (PG) , Kraft Foods (KFT) and WalMart (WMT) .

Like Coca-Cola and WalMart, the long-term strength of Mastercard and American Express will heavily depend on the consumer’s recovery. As individuals regain confidence, they will become increasingly willing to use credit cards in order to make big ticket purchases.

As noted by Bloomberg following news of Buffett’s actions, the consumer has already started off 2011 on a postive note. According to the quarterly report issued by the U.S. Commerce Department, retail sales during the first three months of 2011 jumped nearly 3%.

There are a few ways that ETF investors can mimic Buffett’s first-quarter investing decisions. Currently, the iShares Dow Jones U.S. Financial Services Index Fund (IYG) is likely the best bet for those looking to tap into the credit card industry.

Together, Mastercard, American Express, and Visa (V) account for less than 10% of the fund’s index. The fund also provides exposure to a number of other financial institutions Buffett has previously expressed interest in. Wells Fargo (WFC) , Bank of New York Mellon (BK) and M&T Bank (MTB) can be found listed among the fund’s holdings.

While IYG may prove attractive for those looking to gain direct access to Buffett’s credit card plays, fans of the investor can also follow his recent actions by homing in on the broader consumer.

In the past, I’ve highlighted funds such as SPDR S&P Retail ETF (XRT) and the iShares Dow Jones Consumer Goods Index Fund (IYK) as strong options designed to target this market sector.

Of these two products, IYK stands out as likely the best choice for investors looking to follow the Nebraska native. P&G, Coca-Cola, and Kraft can be found listed among the fund’s top ten holdings and together represent over a quarter of its portfolio.

Although Buffett made only a few tweaks to his portfolio during the first quarter of 2011, the moves were attention-grabbing. Looking ahead, it will be interesting to see what is more in store for this legendary portfolio.

Disclaimer

Welcome to Don Dion’s Daily ETF Winners and Losers. Be sure to stop by each day to get a feel of who’s winning and who’s losing when it comes to ETFs.

Winners

iShares MSCI France Index Fund (EWQ) 1.9%
The France ETF is a noticeable leader as we approach the close the week. Like other international funds from iShares, EWQ is designed to provide investors with exposure to the largest and most liquid companies based in France. The fund’s largest holdings include Total (TOT) , Sanofi-Aventis (SNY) and BNP Paribas.

Fellow European ETFs displaying strength include iShares MSCI Sweden Index Fund (EWD) , iShares MSCI Netherlands Investable Market Index Fund (EWN) , and iShares MSCI EMU Index Fund (EZU) .

JPMorgan Alerian MLP Index ETN (AMJ) 1.1%
Exchange traded products designed to target master limited partnerships are heading higher today despite weakness in natural gas prices. Companies represented in products such as AMJ and Morgan Stanley Cushing MLP High Income Index ETN (MLPY) are responsible for storing and transporting this fuel.

Aside from being unique options for natural gas hungry investors, MLPs offer attractive yields.

Market Vectors Rare Earth/Strategic Metals ETF (REMX) 0.9%
Shares of industry-leader Molycorp (MCP) are helping to lift REMX to leading gains. According to the fund’s website, MCP accounts for over 5.5% of its total portfolio, making it the sixth largest holding.

Thursday marks REMX’s third consecutive day of gains.

Losers

iPath Dow Jones UBS Sugar Subindex Total Return ETN (SGG) -4.1%

A number of soft commodities-linked ETNs are heading south, led by SGG and the iPath Dow Jones UBS Cotton Subindex Total Return ETN (BAL) . In both cases, Thursday’s decline has snapped a multi-day run-up.

Single-crop commodity funds such as SGG and BAL are wildly volatile options and therefore, investors looking for long-term plays on agriculture should steer clear.

Market Vectors Vietnam ETF (VNM) -2.6%
Vietnam’s marketplace is heading into the close of the week on a low note, leading VNM to suffer its fourth consecutive day of losses. This downturn has pushed the fund to new 2011 lows, revisiting levels last seen in September 2010.

Frontier nations like Vietnam are inherently volatile. Investors looking to try their luck here must be ready for bouts of tumultuous action.

iPath Dow Jones Natural Gas Subindex Total Return ETN (GAZ) -5.5%
Natural gas prices are heading lower, pressured by this morning’s Energy Information Administration storage report. According to the agency, stockpiles of the fuel grew more than expected during the past week.

GAZ’s 8% premium is playing a major role in pushing the fund to heavier declines than its fellow natural gas futures-backed product, United States Natural Gas Fund (UNG) .

Disclaimer

Precious metals have become a major region of interest for ETF fund sponsors. Since its introduction in late 2004, the physically based SPDR Gold Shares (GLD) has taken off in popularity, gathering over $60 billion in assets, making it the second largest ETF in the world.

Over the ensuing years, the success of this fund has been noticed by large and small providers. Many, attempting to profit from interest in this corner of the market, have launched their own funds designed to offer ways to gain access to these shiny resources.

While some firms, like Global X and Market Vectors, have opted to take the equity-based route with miner funds like the Global X Silver Miners ETF (SIL) and Market Vectors Gold Miners ETF (GDX) respectively, others have chosen to use futures contracts or physical stockpiles to provide investors with direct access to their desired metals.

Many of the physically based single commodity precious metal ETFs like GLD, iShares Silver Trust (SLV) and ETFS Physical Palladium Shares (PALL) have proven wildly popular amongst investors.

Sensing persistent rampant demand for these shiny metals, providers have continued to develop and evolve their product lines, offering new and unique ways to gain direct access to these commodities.

One particularly interesting development has been the introduction of precious metal basket funds. Today, using products offered by companies such as ETF Securities and PowerShares, investors can instantly tap into two or more precious metals at the same time.

These consolidated precious metals funds may prove popular for a variety of different scenarios. For instance, precious metal bulls who prefer a hands-off approach to investing may find the ETFS Physical Precious Metals Basket Shares (GLTR) to be ideally suited.

This fund is a one-stop-shop precious metal ETF, combining exposure to four resources: gold, silver, platinum, and palladium. According to the fund’s Website, each share exposes investors to approximately 0.3 ounces of gold; 1.1 ounces of silver; 0.004 ounces of platinum; and 0.006 ounces of palladium.

ETF Securities’ ETFS Physical White Metals Basket Shares (WITE) , meanwhile, may prove more attractive for those looking for an active approach to precious metal investing. Each share of WITE provides investors with exposure to a combination of silver, platinum and palladium. According to its sponsor, WITE’s per-share metal entitlement is approximately 1.0 ounce of silver; 0.01 ounce of platinum; and 0.08 ounce of palladium.

Due to the volatile nature of industrious metals like silver, palladium and platinum, WITE is best utilized as a short-term tactical play on market strength. By moving in and out of WITE while maintaining a long-term physical gold holding like GLD, investors can position themselves to benefit during market swings.

Despite its unique and eye-catching take on precious metals, however, WITE is a fund investors should approach with caution. Because the fund’s daily trading volume remains low, it could suffer from liquidity issues down the road.

The PowerShares DB Precious Metals Fund (DBP) is a futures-backed fund that splits exposure across gold and silver.

Currently gold dominates the largest percentage of the fund’s portfolio, accounting for three-quarters of its index. Although its reach across the precious metal spectrum is not as expansive as other options, by cutting out notably volatile players like platinum and palladium, the fund may appeal to conservative investors. Additionally, with an average daily trading volume of over 120,000, DPB is the most liquid of the precious metals basket funds.

The advent of precious metal ETFs has made gaining access to these attractive resources as simple as investing in traditional stocks and bonds. Although the recent commodities shakeup has caused many investors to turn away from gold, silver, platinum and palladium, when the clouds clear and these resources fall back into favor, GLTR, WITE, and DBP will be funds to keep on the radars.

Disclaimer

In recent weeks, a variety of factors have helped to muddy many investors’ market outlooks.

The ongoing commodities shakeup, concerns about the U.S. debt limit, and the ongoing political and economic turmoil facing regions including Europe, the Middle East and Northern Africa are among the issues that are currently reigniting fears and causing skittish investors to second guess the strength and longevity of the ongoing market recovery.

Given these looming concerns, the relief that comes with sticking to the sidelines may be attractive. However, heading for the exits is not the ideal option at this time. Though rocky, we remain on the road to recovery, and investors who choose to bail out now will risk missing out on any strength in store for when the skies clear down the road.

The ETF industry is laden with funds that are well-designed to ease the minds of jittery investors and prepare them for all types of investing environments. Amidst choppy markets, appropriate exposure to defensive assets such as gold and fixed income can help provide a welcomed dose of comfort and portfolio stability during times of uncertainty.

Dividend-paying equity ETFs such as iShares Dow Jones Select Dividend Index Fund (DVY) and SPDR S&P Dividend ETF (SDY) are two options investors may want to consider when looking for ways to both protect against turmoil and prepare for upward action ahead.

Both DVY and SDY provide investors with expansive coverage of the yield-bearing equity universe and provide investors with payouts of more than 3%. In examining the respective breakdowns of the two funds, however, a number of marked differences come to light.

DVY, the older of the two funds, aims to replicate the performance of the Dow Jones U.S. Select Dividend Index. According to the fund’s prospectus, this index is comprised of 100 companies in the Dow Jones U.S. Index that “have provided a relatively high dividend yields on a consistent basis over time.”

The S&P High Yield Dividend Aristocrats Index, which underlies SDY, meanwhile, seeks to combine the 50 highest yielding companies in the S&P Composite 1500 Index. In order to be considered as an index component, however, a company must have consistently raised its dividend over the past 25 years.

Due to the divergences between their respective indexing strategies, DVY and SDY boast noticeably different underlying holdings. For instance, DVY’s index is heavily geared towards utilities and consumer goods, which together account for over 50% of the fund’s index. SDY, on the other hand, leans more towards the consumer staples and financials industries, which represent slightly over one-third of the fund’s assets.

DVY’s top holdings include Lorillard (LO) , Chevron (CVX) and Entergy (ETR) . SDY is headlined by CenturyLink (CTL) , Pitney Brothers (PBI) and Leggett & Platt (LEG) .

While both products will prove effective in providing investors with adequate exposure to dividend-paying companies, DVY has been a consistent outperformer and my personal fund of choice. Aside from outpacing its competitor, year-to-date, DVY has also managed to surpass the broader S&P 500 by a comfortable margin.

This recent bout of economic turmoil may be disconcerting. However, rather than heading for the exits, conservative long term minded investors should view this recent market soft spot as a chance to gear up for future strength. By utilizing defensive asset classes and dividend-yielding equities, nervous investors will be able to protect against current headwinds and prepare for profits in the weeks and months ahead.

Disclaimer

At the start of this week, Joy Global (JOYG) stole the headlines with news that the coal mining equipment firm was planning to purchase LeTourneau Technologies from Rowan Companies (RDC) for $1.1 billion.

There are a number of ETFs that will be likely affected as more is learned about this deal.

The most direct way to gain access to the Joy Global deal is through the Market Vectors Coal ETF (KOL) , which is designed to track some of the world’s largest and most liquid coal-related companies. Currently, shares of JOYG represent 8% of its portfolio, making it the third largest position.

Other major KOL holdings include Bucyrus International (BUCY) , Consol Energy (CNX) and Peabody Energy (BTU) .

Although it is less obvious, the First Trust ISE Revere Natural Gas Index Fund (FCG) is another fund that may fall into focus in response to Joy Global’s LeTourneau acquisition.

Joy Global is the most recent example of a big name energy firm branching off from its bread and butter niche and venturing into the realm of natural gas. One of the more memorable was Exxon Mobil ’s (XOM) landmark decision in late 2009 to purchase XTO Energy. The deal, valued at approximately $40 billion, was viewed as a major vote of confidence for the natural gas industry and has raised speculation as to how big of a role natural gas will play in Big Oil’s future.

Fellow coal companies have taken steps to boost their exposure to natural gas as well. For example, in 2010, coal heavyweight Consol Energy completed the buyback of its natural gas spin- off CNX Gas. During the same year, the firm spent an additional $3.5 billion to acquire natural gas-related assets from Dominion Resources (D) .

The fact that big names from oil, coal and other corners of the energy market are willing to gain take steps into natural gas bodes well for the resource’s prospects as we look ahead.

At this time, FCG stands out as the strongest, and most liquid equity-based energy ETF dedicated specifically to companies with expansive exposure to natural gas. The fund’s index is headlined by companies including Cabot Oil & Gas (COG) , PetroHawk Energy (HK) , Southwestern Energy (SWN) and Stone Energy (SYG) .

On top of providing investors with general exposure to natural gas companies, FCG is an attractive play for investors looking to benefit as firms like Joy Global expand their presence in the natural gas industry. Reflecting their increased reliance on this fuel, FCG currently boasts notable exposure to oil majors including Exxon, Royal Dutch Shell (RDS.A) and ConocoPhillips (COP) .

Looking ahead, commodities appear set for volatility. Therefore, investors must use caution when jumping into KOL, FCG, or any other resource-related fund. These products are best utilized as small, niche components of a well-diversified portfolio.

Disclaimer

Welcome to Don Dion’s Daily ETF Winners and Losers. Be sure to stop by each day to get a feel of who’s winning and who’s losing when it comes to ETFs.

Winners

iPath Dow Jones UBS Cotton Subindex Total Return ETN (BAL) 5.1%
Commodities are seeing mixed action at the start of this week. While agriculture-related funds such as the Teucrium Corn ETF (CORN) , BAL, and iPath Dow Jones UBS Sugar Subindex Total Return ETN (SGG) are heading higher, other resources are stuck in negative territory.

It is difficult to judge where these single commodity funds will head from day to day. Investors looking for a stronger, more reliable long term play should turn to diversified options like PowerShares DB Agriculture Fund (DBA) .

iShares MSCI Turkey Investable Market Index Fund (TUR) 1.6%
The Turkey ETF has struggled throughout this month as uncertainty persists across the Middle East and Northern Africa. During this period, the fund has moved downward, dipping below its 50- and 200-day moving average and revisiting levels seen prior to its April run-up.

iShares MSCI Sweden Index Fund (EWD) 1.9%
The Swedish marketplace is starting off the week on a positive note, leading EWD to gains. Sweden may prove to be an attractive option for investors looking for relatively stable European exposure. However, before jumping into this fund it is crucial to remember that nearly 20% of its portfolio is spread across two holdings: Ericsson (ERIC) and H&M.

Losers

United States Gasoline Fund (UGA) -4.0%
Gasoline prices are taking a steep hit at the start of this week, leading the futures-based UGA to industry leading losses.

Meanwhile, other energy related ETFs are behaving in a mixed fashion. The United States Oil Fund (USO) is following UGA lower while the United States Natural Gas Fund (UNG) is up nearly 2%.

First Trust Dow Jones Internet Index Fund (FDN) -2.0%
Internet players including Amazon (AMZN) , eBay (EBAY) , Salesforce.com (CRM) and Yahoo! (YHOO) are running into trouble and leading the internet ETF to notable losses.

Despite its downturn, I continue to view FDN in a positive light. The fund is a strong play for investors looking for a well-balanced way to tap into the technology industry.

iShares Silver Trust (SLV) -2.5%
Silver’s shaky action has continued as we start the second half of May as bullion-backed products like SLV and ETFS Physical Silver Shares (SIVR) tread lower.

Gold, meanwhile, is holding up. During early afternoon trading, shares of iShares Gold Trust (IAU) were unchanged.

Disclaimer

Here are five ETFs to watch this week.

iShares Silver Trust (SLV)
As I forecasted in last week’s “5 ETFs to Watch,” commodities have continued to behave in a volatile manner. The bullion-backed SLV’s performance was particularly bipolar. During the early part of the week, SLV managed to pull off gains but its strength was short-lived. By the Friday, it had retreated to the previous week’s lows.

Silver will continue to generate press in the week ahead as market watchers debate and discuss the longevity of the current commodities shake up, and look for ways to navigate it.

Although I continue to view precious metals as a promising long-term play, I urge investors to avoid being overly exposed to this asset class. By keeping exposure to materials like gold and silver small and concentrated, it is possible to benefit from their long-term defensive nature while protecting against short term volatility.

Market Vectors Agribusiness ETF (MOO)
Like SLV, agricultural-related ETFs will be in the spotlight as commentators and analysts investigate the ongoing volatility across the commodities spectrum. The equity-backed MOO will be of particular interest on Wednesday, when industry leader Deere (DE) reports its earnings. DE is listed as MOO’s second largest holding and accounts for over 8% of its total assets.

In past quarters, the farming equipment maker has been an impressive earnings performer, beating out analysts estimates. Looking to the week ahead, it will be interesting to see if it can follow through with another strong report.

iShares Dow Jones U.S. Home Construction Index Fund (ITB)
A variety of real estate-related data points are scheduled to be released this week, thrusting the residential housing market and homebuilders into the spotlight. On top of the housing starts and existing home sales data that are slated for Tuesday and Thursday respectively, Home Depot (HD) and Lowes (LOW) will report their earnings reports during the first half of the week.

ITB and the SPDR S&P Homebuilders ETF (XHB) will likely be exciting to watch in the coming days, though I continue to have reservations towards the real estate industry. The iShares Cohen & Steers Realty Majors Index Fund (ICF) remains my fund of choice for this region of the market.

SPDR S&P Retail ETF (XRT)
Discount retail goliath Wal-Mart (WMT) is slated to report its quarterly earnings performance on Tuesday. On top of providing investors with information on the state of the consumer, this report typically signifies the end of the earnings season.

Aside from Wal-Mart, investors should be closely following Target (TGT) , Limited Brands (LTD) , TJX Companies (TJX) , Abercrombie & Fitch (ANF) and Sears Holdings (SHLD) .

The consumer continues to be resilient. In the face of worries over rising costs, the XRT has managed to stick to its upward trajectory, establishing new highs for the year.

SPDR Dow Jones Industrial Average ETF (DIA)
The large-cap dominated Dow Jones Industrial Average has staged an impressive run-up recently. Over the past 30 days, shares of DIA have managed to outpace small- and mid- cap-linked ETFs such as iShares Russell 2000 Index Fund (IYM) and the iShares S&P 400 Mid Cap Index Fund (MDY) .

It is too soon to tell whether the business cycle has shifted in favor of large- and mega-caps. However, in the event that the market runs into turmoil, the size and stability of companies like International Business Machines (IBM) , Caterpillar (CAT) , and McDonalds (MCD) will likely prove popular, boosting the appeal of funds like DIA.

Disclaimer