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ETFfolio Launches International Closed-ended ETFfolio in Teeth of Financial Storm

By Carl Delfeld of Chartwell ETF & ETFfolio

ETFfolio launched this afternoon a new ETFfolio called the International Closed-ended ETFfolio.

The ETFfolio contains 15 closed-ended funds selling at substantial discounts to their net asset value. Given the sharp pullback in international markets this year, the folio hopes to benefit from low valuations but with the cushion or shock absorber of prices trading below net asset value.

The international closed-ended ETFfolio offer investors exposure to the following countries: Israel, South Korea, Ireland, Chile, China, Russia, Indonesia, Singapore, Spain, Germany, Malaysia, Mexico, Thailand, Turkey and Taiwan.

In some cases, due to their discounts and/or company distribution, closed-ended funds can be a superior option to exchange-traded funds in gaining exposure to specific international markets.

The World Country Rotation ETFfolio is essentially flat since its launch it January 2008.

Chartwell Global 30 Reaches 3rd Anniversary: Beats Dow Decisively

By Rick Leonidas of Chartwell Partners Asset Management

The Chartwell Global 30, a fund offering investors exposure to 15 American and 15 international companies, recently reached its three year mark. It balanced and global approach has yielded substantially higher returns than the Dow Jones Industrial Average and the S&P 500 index for that matter. It currently contains companies headquartered in 12 countries around the world.

The companies in the Chartwell Global 30 are largely drawn from the Forbes Global 2000 based factors such as a low debt-to-capital ratio, long-term and short-term sales growth, profit growth, return on equity and total return over five years. The companies in the Chartwell Global 30 need to have shares traded in the U.S. or American Depositary Receipts, a share price of at least $5, positive equity and sales of at least $1 billion.

Despite the globalization of the investment business, the most-quoted market indicator in the financial media is remains the Dow Jones industrial average, which was created in 1896. Unfortunately, the Dow is still the center of the investment universe for many American investors.

Charles Dow created the first Dow Jones index in 1896. It included nine railroad stocks, a steamship line and a communications company. In 1916, the industrial average expanded to 20 stocks; the number of components was raised again in 1928, to 30, where it remains today. The Dow is a benchmark that tracks American stocks considered to be the leaders of the economy in a number of industries. The component stocks are listed on both the New York Stock Exchange, like Citigroup and IBM, and on the Nasdaq, like Intel and Microsoft.

The Chartwell Global 30 keeps the same number of companies and the equal weighting approach but expands the universe of companies. The Chartwell Global 30 is managed by Carl Delfeld, head of Chartwell Partners, Forbes Asia columnist, former U.S. Representative to the Asian Development Bank, U.S. Treasury consultant and international economist with the U.S. Congress.

For more information on the Chartwell Global 30, contact Carl Delfeld directly at 719.264.1503.

Mexican, Australian ETFs Top Ten Year Returns

By Carl Delfeld of the Chartwell ETF Advisor

Over the past ten years, exchange-traded fund investors have been on the money to invest in overseas markets. Returns have been aided by a falling dollar and strong export growth.

Nine of the ten ETFs with the biggest yearly returns tracked overseas markets, according to Lipper data. Of those nine, four were in emerging markets.

The best performing country ETF was the iShares MSCI Mexico, (EWW) which pulled in an annualized 16.99% over the last ten years while the S&P 500 returned 3.88% a year over the same span.

Jesse Emspak of the IBD noted that the iShares MSCI Mexico tracks the Bolsa Mexicana, the country's stock exchange. It's relatively concentrated, with about 25% of the ETF weighting in America Movil (AMX).

Like many Latin American economies, Mexico has had steady, if modest, growth in the last decade.
The country also is exporting more to Europe and Asia as trade ties have grown and the peso has fallen in tandem with the dollar.

The next best returns come from iShares MSCI Australia, (EWA) which had an average annual return of 13.76% over the past ten years. Its biggest holding is BHP Billiton, (BHP) which took up 13.68% of the ETFs total assets. Australia has benefittted from being at the sweet spot of Chinese economic growth and the commodity boom.

Both the Mexican and the Australian ETFs have been part of Chartwell's Country Rotation ETFfolio.

Chartwell ETF Announces Investment Tour of Singapore, Malaysia and Thailand

By Carl Delfeld of the Chartwell ETF Advisor and Chartwell Partners Asset Management

Five years ago, many analysts believed that Southeast Asian markets would be in trouble due to intense competition from China. However, as I predicted, the region has thrived and offers investors a great play on Asian growth.

Isn’t it about time you learn more about this dynamic and fascinating region? Join me on a luxury adventure from Singapore through Kuala Lumpur to Penang and then on to Bangkok from January 26th to February 3rd, 2009.

Travel in style aboard the historic Eastern & Oriental Express and enjoy all the sites and culture of Southeast Asia while also learning more about the region’s investment opportunities. Our adventure begins with three days in Singapore at the Raffles Hotel. After interesting economic, company and regional investment briefings from experts plus a visit to places like the Singapore Stock Exchange during the mornings, enjoy flexible touring options such as cruises, sightseeing or sporting activities in the afternoons and evenings. One morning will be dedicated to Malaysia which has been a steady performer.

On the fourth day, the Eastern & Oriental Express departs Singapore’s Keppel Road station in the morning. Having been welcomed onboard the gleaming carriages, settle into your luxury cabin and, if you wish, meet interesting people from all over the world. Enjoy the passing scenery as the train crosses to Malaysia via the causeway of the Straits of Johor.

The E&O will pause at Kuala Lumpur’s magnificent Moorish-style station before departing for an overnight journey towards Bangkok with side trips to the island of Penang and the River Kwai. Our home for three days in Bangkok will be the prestigious Oriental. Throughout our trip, we will schedule investment-oriented activities in the mornings allowing you the freedom during afternoons and evenings.

The tour is limited to 25 investors. For more information, go to Chartwell ETF or contact Carl Delfeld at 719.264.1503.

Claymore Launches EAFE Country Rotation ETF

Claymore in partnership with Zacks has launched a country rotation exchange-traded fund that poses a challenge to the most popular international index and ETF, the iShares MSCI Europe, Australia and Far East Index (EFA).

The Claymore/Zacks Country Rotation ETF (CRO) seeks to track the Zacks Country Rotation index comprisesed of stocks selected from a universe of international companies based in countries included in the MSCI EAFE Index and Canada, with the exclusion of companies based in Greece. The companies in the universe are selected using a proprietary methodology developed by Zacks Investment Research.

The EFA exchange-traded fund weights countries in the index by the market value of their respective stock market. Therefore, Japan and the United Kingdom account for 46% of the exposure in the ETF basket.

One flaw in the new Claymore/Zacks ETF is that it excludes all of the fast growing and top performing emerging market countries. Emerging market countries account for 85% of the world’s population, 25% of global economic output and represent 50% of 2007 economic growth. Compared to only a few years ago, many of these countries have higher foreign exchange reserves, lower foreign debt, lower inflation, higher credit ratings and have as a group achieved average economic growth rates of 7.7% during the last four years.

The Chartwell World Country ETF Rotation Portfolio includes thirty two developed and emerging market countries with the goal of exceeding the performance of the MSCI World index. This portfolio weights country specific ETFs using a momentum based model with a valuation check while maintaining some flexibility to act on special opportunities.

By Carl Delfeld of the Chartwell ETF Advisor

PowerShares Announces Four New International ETFs

On June 25, 2007 PowerShares family of exchnage-traded funds will launch the first wave of PowerShares FTSE RAFI International Portfolios, which use a fundamental approach to select and weight companies in the index. The funds anticipated to launch are:

PXF PowerShares FTSE RAFI Developed Markets ex-U.S. Portfolio
PAF PowerShares FTSE RAFI Asia Pacific ex-Japan Portfolio
PEF PowerShares FTSE RAFI Europe Portfolio
PJO PowerShares FTSE RAFI Japan Portfolio

Similar to the approach used by industry professionals, companies are weighted not simply by a single measure such as market-capitalization, dividends or earnings, but rather by the size of their fundamentals. Companies are selected based on the following four fundamental measures of size: sales, cash flow, book value and dividends.

The indexes on which the portfolios are based utilize an investable, liquid universe of more than 2,000 global equities that span more than 20 countries. These indexes are designed to track the performance of some of the largest global region or country-specific equities.

Posted by Carl Delfeld of the Chartwell ETF Advisor which offers investors seven model ETF portfolios including an International, Global and Asian Opportunity portfolio.

A Weak Dollar Helps Foreign Country ETFs

How do changes in the value affect US companies and US exchange-traded funds? It is not as straight forward as it looks. First, a falling dollar raises the dollar value of foreign sales. Big US multinationals receive roughly half of their total sales from overseas. For S&P  500 companies it is about 30 per cent of their sales overseas compared with 15 per cent for smaller companies in the Russell 2000) When the dollar weakens, the value of those sales grows. Hence international “mega-cap” companies, laggards for years, have recently outperformed. A weak dollar im­proves the case for big US stocks.

But as John Authers points out, globalization also affects costs and the proportion of costs a company deducts from revenue to determine profitability. Plus, look at Europe, the stronger euro has not hurt their share prices even though they are even more international in terms of sales than most American firms.

One of the reasons European and Asian ETFs are doing so well this year is the stronger Euro and stronger Asian currencies with the Japanese yen being the primary exception. Remember, international ETFs are not hedged against the US dollar so a weaker dollar will help their returns.

By Carl Delfeld of the Chartwell ETF Advisor

SPDR DJ Wilshire Intl Real Estate (RWX)

State Street Global Advisors (SSgA)*, the investment management arm of State Street Corporation today announced that assets in the SPDR(SM) DJ Wilshire International Real Estate ETF (AMEX: RWX) have reached $500 million. It is the first ETF to provide investors with access to global real estate securities publicly-traded outside the US.

"A number of catalysts appear to be driving investor demand for international real estate exposure, including a very low correlation to the broader US and international equity markets," said James Ross, senior managing director of SSgA. "The significant inflows into the SPDR DJ Wilshire International Real Estate RWX ETF indicate that investors have quickly embraced this offering as a vehicle to gain more precise exposure to the global markets."

Launched on December 19, 2006, the SPDR(SM) DJ Wilshire International Real Estate ETF has emerged as the fastest growing ETF listed in the US during the past six months. As of March 7, assets under management in the fund totaled approximately $500 million.**

** Source: SSgA Strategy & Research as of March 7, 2007

DE Smith of MyPortfolioView

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

Don't Forget SPDR International ETFs

Don't neglect State Street Global Advisors' (SSGA) six new SPDRs emerging markets exchange-traded funds or ETFs that are listed on the American Stock Exchange (Amex). The funds are based upon the S&P/Citigroup Global Equity Indices and will carry expense ratios of 0.60 percent. At of the end of February 2007, State Street managed more than $109 billion ETF assets in a total of 76 ETFs worldwide.

Here are the ETFs with a brief description.

SPDR S&P Emerging Markets ETF (GMM)
Index includes more than 1,500 companies across 26 emerging countries.

SPDR S&P Emerging Latin America ETF (GML)
Index includes companies domiciled in Argentina, Brazil, Chile, Columbia, Mexico, Peru, and Venezuela.

SPDR S&P Emerging Middle East & Africa ETF (GAF)
Index includes companies domiciled in Egypt, Israel, Jordan, Morocco, Nigeria, and South Africa.

SPDR S&P Emerging Europe ETF (GUR)
Index features companies in countries that are nearing acceptance into the EU, including Czech Republic, Hungary, Poland, Russia, and Turkey.

SPDR S&P Emerging Asia Pacific ETF (GMF)
Index includes companies domiciled in China, India, Indonesia, Malaysia, Pakistan, the Philippines, Taiwan, and Thailand.

SPDR S&P China ETF (GXC)
Underlying index includes over 150 companies domiciled in China.

By Carl Delfeld of the Chartwell ETF Advisor