It may not seem like much, but a stock's ticker does have slight
meaning in terms of how the shares perform right out of the gate.
As wild as it may seem, there is
evidence to support the fact that stocks with
outperform those without catchy trading symbols immediately
following their respective initial public offerings.
Obviously, investing based on a stock's ticker alone is
foolhardy and regardless of how memorable a ticker is, if there is
something fundamentally wrong with the company behind the ticker,
the market will eventually make the stock pay.
Tickers as they pertain to ETFs are a different story,
particularly because analysts, traders and others refer to ETFs as
"the FAZ" or "the GLD." So it is not surprising
that ETF issuers put some effort into coming up
with catchy trading symbols
Again, do not buy an ETF just because of its ticker, but have a
look at the following funds to see if it is possible to have a
pronounceable symbol and generate solid returns.
Direxion Daily Gold Miners Bull 3X Shares (NYSE:
No, that ticker is not "nugget," but the reality is that is how
this triple-leveraged play is referred to in some circles. Is it
plausible that traders say to each "Are you trading the N-U-G-T
today?" Sure, but it is more plausible that they say "I'm trading
Regardless of ticker, NUGT proved to be the ideal way to profit
from the QE3 announcement as the fund surged 15.1 percent. NUGT has
a bearish cousin with a memorable ticker, the Direxion Daily Gold
Miners Bear 3X Shares (NYSE:
Direxion Daily Healthcare Bull 3X Shares (NYSE:
Another triple-leveraged play with a memorable ticker, the
Direxion Daily Healthcare Bull 3X Shares tracks the same index as
the popular Health Care Select Sector SPDR (NYSE:
). Highlighting the belief that tickers are not everything, CURE
had a bearish equivalent that was closed earlier this month, the
Direxion Daily Healthcare Bear 3X Shares. That fund traded under
the ticker "SICK."
PowerShares DWA Emerging Markets Technical Leaders Portfolio
The PowerShares DWA Emerging Markets Technical Leaders Portfolio
might have one of the best ETF tickers around. PIE's returns are
not too shabby, either, as the fund is up 10.6 percent year-to-date
and 7.5 percent in the past 90 days.
The $166.6 million ETF is a multi-country emerging markets play,
but this fund is not to be confused with the likes of the Vanguard
MSCI Emerging Markets ETF (NYSE:
). PIE uses a relative strength screen and that means
different country weights than what are found in
traditionally weighted emerging markets funds
At 14 percent, South Korea is PIE's second-largest country
allocation and it is common for that country to play a prominent
role in many mulit-country funds. However, Malaysia, Indonesia and
Thailand combine for about 35 percent of PIE's weight, giving the
fund significant exposure to some of Asia's more impressive growth
Market Vectors Agribusiness ETF (NYSE:
First-to-market advantage, not the ticker, is probably the
reason MOO has been the dominant agribusiness ETF since it came to
market five years ago. Several ETF sponsors have introduced
competing products over the years, but none have really challenged
MOO's agribusiness supremacy. Some of those rivals folded. The ones
that are still around are practically unheard of in comparison to
the $5.6 billion MOO.
Proving a catchy ticker does not mean big inflows, the iShares
MSCI Global Agriculture Producers Fund (NYSE:
) debuted in late January and even though it has a lower expense
ratio than MOO, VEGI has not come close to even being a thorn in
MOO's side. VEGI has slightly outperformed MOO in the past three
months, but that has not meant much in terms of inflows. VEGI has
just $10.3 million in AUM.
For more on ETF tickers, click
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