TradingMarkets 7 ETFs You Need to Know for Tuesday

By | TradingMarkets.com | December 22, 2008 03:40 PM
Symbols: XLE, USO, UYG, IYF, SMN

Virtually all sectors were trading lower as of the final hours of trading on Monday, with corrections and pullbacks especially significant in the materials sector. Financial stocks as well as energy stocks were also failing to attract buyers.


Here are 7 ETFs You Need to Know for Tuesday.


The sell-off in Basic Materials stocks on Monday helped send the ProShares UltraShort Basic Materials ETF, SMN ( SMN | Quote | Chart | News | PowerRating) significantly higher. The fund was deeply oversold as recently as last Wednesday.


Falling prices for crude oil mean continued falling prices for the United States Oil Fund, USO ( USO | Quote | Chart | News | PowerRating) which broke down to new lows on Monday. Remember that ETF traders looking for exposure to oil stocks - rather than the price of oil - should turn to other ETFs that track oil service and exploration companies. These include with widely traded Energy Select Sector SPDRS, XLE ( XLE | Quote | Chart | News | PowerRating).


Down for a third day in a row on Monday were the ProShares Ultra Financials ETF, UYG ( UYG | Quote | Chart | News | PowerRating). Also lower, but by a lesser percentage, was the non-leveraged, iShares Dow Jones U.S. Financial Sector Index ETF, IYF ( IYF | Quote | Chart | News | PowerRating) which includes stocks such as JP Morgan Chase ( JPM | Quote | Chart | News | PowerRating), Wells Fargo & Company ( WFC | Quote | Chart | News | PowerRating) and Bank of America ( BAC | Quote | Chart | News | PowerRating).


Looking to diversify your investment and trades by investing style? Increase your exposure to small-cap growth stocks by way of an ETF like the Vanguard Small Cap Growth ETF, VBK ( VBK | Quote | Chart | News | PowerRating). Prefer a value-oriented approach? Consider the Vanguard Small Cap Value ETF, VBR ( VBR | Quote | Chart | News | PowerRating). The value ETF is currently weighted most heavily in industrial materials and financial services stocks. The growth fund has its strongest sector weighting in health care.


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Original publication: December 22, 2008

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