Nadig: 3 ETFs I Wish I’d Bought

May 15, 2014

A few could-a, should-a, would-a ETF picks from ETF.com's chief investment officer.

I don't live my life with much regret; it leads to too much stress. But I was looking at that one trade I'd made in the last little while—the iShares Spain ETF (EWP | B-94)—and that got me looking at the top-performing funds for the last 12 months.

Here's the top 10 list:

Fund Ticker 1-Year Performance
Guggenheim Solar TAN 80.39%
Market Vectors Solar Energy KWT 69.00%
Market Vectors Egypt EGPT 62.39%
iPath Global Carbon ETN GRN 60.17%
First Trust ISE Global Wind Energy FAN 52.82%
Market Vectors Gulf States MES 45.09%
WisdomTree Europe SmallCap Dividend DFE 44.26%
iShares U.S. Aerospace & Defense ITA 43.95%
iShares MSCI Denmark Capped EDEN 43.67%
SPDR S&P Pharmaceuticals XPH 42.63%

Now, I'm not going to beat myself up about anything here. These are some pretty narrow calls—big bets on alternative energy and the Middle East. There wasn't much chance I was going to pile into Denmark, or pharma or defense stocks. I'm glad all those ETFs are there, I just don't think I'd ever have had the prescience to make a meaningful allocation to them a year ago.

Except …

The one slightly annoying one, from a regrets standpoint, is the iPath Global Carbon ETN (GRN). To be clear, this is an ETN that's had periods of such low liquidity as to be nearly un-ownable. But it's also the poster child of where the ETN structure can give investors access to previously inaccessible, and in this case, invisible, assets.

GRN is tied to an index of carbon credits, a market that's not all that efficient, and notoriously difficult to access. And, when things started heating up for alternative energy, GRN lagged. Eventually the writing was on the wall.

GRN

The window was small, but there have definitely been windows. GRN has since seen volume increase, trading as much as 100,000 shares on some days. So, a very careful, very smart trader might have been able to swoop in.

But who am I kidding? There's really no chance I would have made that kind of a tactical play. So all in all, the top 10 isn't the subject of much regret. But what if we dig into the next tier?

 

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