ETF XRAY

State Street's New International ETFs

State Street has introduced two new exchange-traded funds; one an all world ex-US ETF and one targeting international small cap companies in developed countries.

A press release from the company describes the SPDR S&P International Small Cap ETF (GWX) includes companies with market caps under $2 billion domiciled in developed countries outside the U.S. and carries a 0.60% expense ratio. The SPDR S&P World ex-US ETF (GWL) includes more than 5,000 companies domiciled in developed countries outside the U.S. including Canada and carries a 0.35% expense ratio.

The two new ETFs will begin trading on April 26th.

With the launch of these two SPDRs, State Street’s family of US-listed ETFs features 53 funds – including a full suite of 16 that offer precise access to international and emerging markets. State Street manages more than $114 billion of ETF assets worldwide (as of March 31, 2007) and is one of the largest providers in the US and globally, with a market share of nearly 20 percent

By Carl Delfeld of the Chartwell ETF Advisor

Forbes Global 2000 Fill ETF Baskets

Many of the global, sector, and country exchange traded funds are peppered with the world's top ranking multinationals and that is why it is useful to take a look at the fourth annual Forbes Global 2000 list to see what's happening.

Tim Ferguson of Forbes writes about how company movement on the list is more than one might expect.
With China and other emerging economies muscling their way onto the list, slower moving countries and companies give way: 38 Japanese companies fell off this year, despite a recovery taking hold there. (Nine joined.) But Tim writes that--surprise!--the region with the biggest net gain this year is western Europe. American investors that think that Europe is turning into just a Disneyland should take note.

A company clearly also has to keep moving ahead to hold their position. Three years ago the No. 100 in rank had sales, profits and market value roughly half the size of BASF, which has the slot this year. Being in the right business--lately, oil and other commodities or finance is helpful.

In America, dynamic capitalism is also at work. 75% of the current Fortune 100 companies did not even exist in 1980. Get the big new biography of Schumpeter today.

By Carl Delfeld of the Chartwell ETF Advisor

Emerging Market ETF Snapshot

The emerging market countries and the exchange-traded funds that track them are playing an increasingly important role in the global economy and our global ETF portfolios.

Emerging market countries account for 85% of the world's population, 25% of world GDP and the Deutsche Bank estimates that they will generate 50% of global growth in 2007. During the last four years, emerging market countries had GDP growth overall of 7.7%. But because their stock markets are playing catch up, emerging market stock markets only account for 7% of world stock market value.

This is the opportunity.

Emerging market ETFs include iShares MSCI Emerging Markets (EEM) and Vanguard's slightly lower cost Vanguard Emerging Market (VWO). In the Vanguard ETF basket there are the following country allocations: South Korea, 15.7%, Taiwan, 12.4%, Brazil and China, 10.5%, Russia, 10%, South Africa, 8.6% and India and Mexico, 6.3%. There are also seven emerging market country iShares available if you prefer a rifle rather than shotgun approach. These ETFs cover markets in Brazil (EWZ), Malaysia (EWM), Mexico (EWW), South Africa (EZA), South Korea (EWY), Taiwan (EWT) and China (FXI).

By Carl Delfeld of the Chartell ETF Advisor

S&P 500 ETF Companies Continue Profit Streak

The Financial Times reported today that the S&P 500 companies in the exchange-traded funds or ETFs that track this index such as (IVV) continued its streak of 10% plus earnings growth.

For the 14th consecutive quarter, companies in the index had earnings growth of more than 10% in the fourth quarter of 2006. Some tax breaks and financial engineering no doubt helped the numbers and the underlying growth certainly was lower.

The question is where do the numbers go from here? Most analysts expect earning to grow about 7% for the year and peaking mid year. Another option for ETF investors looking to invest in large companies is the Diamond (DIA) which tracks the Dow Jones Industrial Average and the Mega Cap ETF (XLG) which is an ETF basket containing the largest 50 American companies. Or go global with (IOO) which is a basket of the largest 100 companies in the world with about half of them based in America.

By Carl Delfeld of the Chartwell ETF Advisor