The bankruptcy announcement from Lehman Brothers ( LEH | Quote | Chart | News | PowerRating) and the acquisition of Merrill Lynch ( MER | Quote | Chart | News | PowerRating) by Bank of America ( BAC | Quote | Chart | News | PowerRating) has brought tremendous volatility to leveraged funds with exposure to the financial sector, with double digit gains and losses recorded going into the close on Monday.
Lower by wide margins were emerging markets related ETFs, particularly those linked to stock markets in China and Brazil. Oil-indexed funds were down, while gold ETFs were actually higher on the day and increasingly overbought below the 200-day moving average.
Here are 7 ETFs You Need to Know for Tuesday.
The ProShares UltraShort Financials ETF, SKF ( SKF | Quote | Chart | News | PowerRating) was up more than 16% on Monday, closing above its 200-day moving average for the first time in more than a week.
Conversely, the ProShares Ultra Financials exchange-traded fund, UYG ( UYG | Quote | Chart | News | PowerRating), slid lower by more than 15% after a brief, two-day rally.
Emerging markets related ETFs were among the funds pulling back aggressively on Monday. The iShares Brazil Index Fund, EWZ ( EWZ | Quote | Chart | News | PowerRating), pulled back by more than 9%. The iShares FTSE/Xinhua 25 index exchange-traded fund, FXI ( FXI | Quote | Chart | News | PowerRating), sold off by more than 6%. Both funds are trading below their 200-day moving averages.
The 400+ point rout in the Dow industrials was also a boon for short and leveraged short ETFs, including the ProShares UltraShort Dow30 ETF, DXD ( DXD | Quote | Chart | News | PowerRating), which was higher by more than 7% on Monday.
On the commodities and commodities-related ETFs front, the Oil Service HOLDRS, OIH ( OIH | Quote | Chart | News | PowerRating), fell by more than 7%. The Select Gold Trust SPDRS, GLD ( GLD | Quote | Chart | News | PowerRating), on the other hand, was up more than 2% on its second consecutive higher close. Both ETFs are trading below their 200-day moving averages.
Spend 3 Days with 21 of the Best Traders in the World!
Sound too good to be true? It's not. For a select group of traders, this will be a reality at TradingMarkets 2008 on November 14-16, 2008 at the luxurious MGM Grand Hotel and Casino in Las Vegas, Nevada.
Victor Sperandeo. Gil Morales. Raghee Horner. Gary Kaltbaum. Steve Nison. These are just a few of the top traders in stocks, forex, options, futures and exchange-traded funds who will be speaking and working with traders just like you at TradingMarkets 2008. Don't miss the special event! Click here for more details!
