Best/Worst Daily ETF Returns: GAZ Falls 10%

By IndexUniverse May 21, 2012, 11:00:00 AM EDT

The iPath Dow Jones-UBS Natural Gas Total Return ETN (NYSEArca:GAZ) was the worst-performing exchange-traded product Friday, falling more than 10 percent, as investors heeded a Barclays warning that all but told them to get out of the ETN.

GAZ Fizzles

In an usual move, Barclays-GAZ's issuer-warned Friday that the strategy's "persistent and material premium" relative to its underlying value is likely to continue, meaning the fund's performance should deviate from its underlying index.

The bank went as far as to say that it "believes" GAZ isn't suitable for most investors. The ETNs creations were halted in 2009, presumably because Barclays was hitting, or worried about hitting, position limits on its natural gas exposure.

It's been trading at a premium on and off ever since.

Facebook Letdown

Another big mover on the day was the Global X Social Media ETF (NYSEArca:SOCL), which dropped 6.75 percent, making it the second-worst-performer Friday.

The $19.7 million fund, which serves up broad exposure to the global social media space, doesn't yet hold Facebook-its methodology requires pure-play companies to be public for at least six days before inclusion-but it still felt the weight of investor disappointment at the company's initial public offering on Friday.

Facebook shares ended their first day just 38 cents higher when the broad stock market closed lower, showing some resilience relative to the overall market. Still, the IPO clearly failed to meet investor expectations.

The Dow Jones industrial average fell 73.11 points, or 0.3 percent, to close at 12,369.38.

Sinking Oil Equals Sinking Solar

Another theme affecting the ETF market last week was the ongoing decline in oil prices, now below $100 a barrel in U.S. futures markets.

As investors continued to price in expectations for lower crude oil demand coming from a troubled eurozone, funds that offer exposure to alternative energy looked less attractive than they usually do when oil prices are moving higher.

The Guggenheim Solar ETF (NYSEArca:TAN) and the Market Vectors Solar Energy ETF (NYSEArca:KWT) dropped 5.2 and 4.2 percent, respectively, on the day.

Top Performers

The United States Natural Gas Fund (NYSEArca:UNG) was one of the best-performing ETFs Friday, perhaps benefiting in part by investors bailing out of its competitor, GAZ.

UNG gained 2.75 percent on the day amid hefty trading volume of more than 13.7 million shares.

Aside from that, investors continued to express their concerns about the broad stock market going forward by betting on volatility-linked funds, which again topped the list of best performers Friday.

The four most popular funds that day were linked to the VIX index, also known as the fear gauge. Funds like the iPath S&P 500 VIX Short-Term Futures ETN (NYSEArca:VXX) gained more than 6 percent Friday.


Top 10 1-Day Performers, Excluding Leverage/Inverse Funds and 'lt;1,000 Shares Traded

Ticker Name 1-Day Performance 1-Day Volume AUM ($, mm)
VXX iPath S&P 500 VIX Short-Term Futures ETN 6.48% 89,849,994 2,318.32
VIXY ProShares VIX Short-Term 6.27% 1,865,929 204.15
VIIX VelocityShares VIX Short Term ETN 6.26% 490,801 34.73
CVOL C-Tracks Exchange-Traded Notes on the Citi Volatility 5.83% 69,157 11.58
WEAT Teucrium Wheat 4.46% 7,000 4.81
GREK Global X FTSE Greece 20 3.57% 30,022 2.11
DJCI ETRACS DJ-Commodity Total Return ETN 3.16% 27,525 68.85
UNG United States Natural Gas 2.75% 13,705,220 1,083.54
FUD ETRACS CMCI Food Total Return ETN 2.38% 4,441 40.81
EWP iShares MSCI Spain 2.36% 666,833 136.06
Bottom 10 1-Day Performers, Excluding Leverage/Inverse Funds and 'lt;1,000 Shares Traded
Ticker Name 1-Day Performance 1-Day Volume AUM ($, mm)
GAZ iPath Dow Jones-UBS Natural Gas Total Return ETN -10.03% 586,207 40.50
SOCL Global X Social Media -6.75% 411,476 19.78
EWSS iShares MSCI Singapore Small Cap -6.75% 3,061 2.76
TAN Guggenheim Solar -5.23% 94,531 50.89
EIPO ETRACS Next Generation Internet ETN -5.18% 21,457 6.00
KWT Market Vectors Solar Energy -4.21% 47,946 9.38
WREI Guggenheim Wilshire US REIT -3.95% 20,534 10.11
PYH PowerShares Morningstar Stock Investor Core Portfolio -3.58% 13,370 14.34
EWUS iShares MSCI United Kingdom Small Cap -3.58% 3,796 2.55
QQQM Global X NASDAQ 400 Mid Cap -3.46% 5,460 1.27

Disclaimer:All data as of 6 a.m. Eastern time the date the article is published. Data is believed to be accurate; however, transient market data is often subject to subsequent revision and correction by the exchanges.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.


This article appears in: Investing, ETFs

Referenced Stocks: GAZ, KWT, TAN, UNG, VXX



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