The SPDR S&P 500 (NYSE:
) and the SPDR Dow Jones Industrial Average (NYSE:
) have made a series of new all-time highs this year. So have a
plethora of other
Funds tracking everything from Internet stocks to the
biotechnology sector to spin-offs are not just making new
52-highs this year. They are rising to price points previously
not seen. Ever.
These All-Time ETFs Can Keep Going
Some investors have a tendency to shy away from stocks and
ETFs that are making new highs, particularly if the high in
question is of the all-time variety. However, evidence exists to
support the notion that
buying at new highs can be a good idea
Of course, investors usually prefer to get involved with an
ETF before it races to fresh all-time highs. Those folks may want
to consider the following ETFs that have enjoyed tremendous
rallies this year, but still have ample room to run to their
prior all-time highs.
Guggenheim China Technology ETF (NYSE:
) In an otherwise glum year for China ETFs, those funds
heavy on Internet stocks have thrived
. And since the Guggenheim China Technology ETF is entirely
devoted to Chinese technology and Internet names, investors have
sent the fund soaring by 27.5 percent.
There might still be upside left here. Assuming CQQQ closes
around $29.20 Thursday, where it trades at this writing, the ETF
would still need to run another 11 percent before reaching its
all-time that printed in April 2011.
Financial Select Sector SPDR (NYSE:
) It is a stretch, but the case of the Financial Select Sector
SPDR might be one weird example where latecomers thank the
financial crisis for something. XLF is up more than 21 percent
year-to-date, but in a testament to just how bad things got for
this ETF in 2008-2009, XLF's all-time high is around $38 and it
printed over six years.
XLF trades around $20.50 today, implying a run of about 85
percent would be necessary to get XLF back to its all-time
higher. That is asking a lot, but then again, many of XLF's
marquee components are nowhere close to previous highs and not
just all-time highs. For example, Bank of America (NYSE:
), an XLF top-10 holding, would need to gain two and a half times
its Thursday closing price to get close to its September 2008
iShares U.S. Technology ETF (NYSE:
) Large-cap tech ETFs have been laggards this year, though IYW is
trading just pennies away from its 52-week high and
getting some help
from resurgent Apple (NASDAQ:
), among others.
In terms IYW getting back to its all-time, nothing is
impossible, but the fund could prove to be a victim of bad
timing. As in bad timing of when IYW came to market. That was in
May 2000 as the tech bubble was bursting. The ETF touched its
all-time around $137 in late August 2000. Although IYW is not a
Nasdaq tracking ETF, its return to the August 2000 highs is
likely correlated with the Nasdaq Composite's ability to rise
another 900 points or so to reclaim its all-time high.
For more on ETFs, click
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