WWW.ETFCONNECT.COM
For a while, market observers were convinced that exchange traded funds (ETFs) would demolish the market for mutual funds.
It was only a few years ago that mainstream financial publications and websites featured columnist after columnist touting the benefits of exchange traded funds. "All the diversification of a mutual fund without the fees or complicated trading restrictions!" went the cry. You want exposure to biotech, but can't figure out which stocks to buy? Try a biotechnology ETF. Like the appreciation of bonds, but not interested in committing large sums of capital to a bond mutual fund? You're in luck, there are more than a few fixed-income ETFs you can buy and trade "just like a stock." Actually, the absence of an uptick rule -- which makes shorting individual stocks that much trickier -- means that in some ways, exchange traded funds are even better than stocks.
Individual stocks will still be able to provide the kind of direct exposure to good companies that investors and traders will always crave, and mutual funds remain the primary way that average investors -- through IRAs and 401(k) plans -- invest, especially for the long term. But the underwriters and supporters of exchange traded funds continue to press what many still see as their unique advantages over both. And with websites like ETFConnect.com, those interested in trading and investing in exchange traded funds can press along with them.
GETTING CONNECTED
ETFConnect.com is a product of Nuveen Investments, a firm with more than a passing knowledge of and interest in both exchange traded funds and closed-end funds. The website is clean and clutter-free, making navigation to any of ETFConnect.com's various departments straightforward and easy. Three departments are on the home page, with seven tabs to other areas of the website listed across the top of the home page. The three departments are "In the Spotlight," "About This Site," and "From Your Sponsor."
In the Spotlight looks at news about exchange traded funds from mainstream financial publications and offers with a growing archive of articles about ETFs from recent years. About This Site introduces new visitors to ETFConnect.com, providing both a guided tour of the website as well as a frequently asked questions section. From Your Sponsor features the results of an informal poll revealing interesting facts about the kinds of exchange traded funds that traders and investors are looking for, as well as a continued demand for a diverse array of ETFs to choose from and a lingering preference for short-term investing and trading with ETFs (in the survey, Nuveen considers "short term" to be less than three years).
At the top of the home page, however, are seven tabs where most investors and traders in ETFs will likely spend most of their time: "Daily Pricing," "Find a Fund," "Fund Sponsors," "Fund Sorter," "Tools," "Industry Links," and "Education Center."
The Daily Pricing tab gives investors and traders pricing information for both closed-end funds and exchange traded funds on one page. Closed-end funds start at the top of the page and are divided into equity and fixed-income categories. The equity category is divided into "taxable global" and "taxable national" funds, and the fixed-income category is divided into both taxable and tax-exempt funds. Taxable funds are divided into both global and national categories, while tax-exempt closed-end funds are divided into individual states (approximately 18 are represented) and national.
Two separate categories for closed-end funds that do not fall so easily into equity or fixed income are located at the bottom of the closed-end fund listing. By comparison, the exchange traded fund categories are much shorter, with Etfs divided into taxable global and taxable national groups.
Pricing information is complete and extensive without being overwhelming. Ticker symbol, fund sponsor, and fund inception date are listed, as is a simple "Y" or "N" to indicate whether the fund is leveraged. Next to this is net asset value data, daily closing price, price change, and the degree to which the fund is priced at a premium or a discount to net asset value -- a key metric with closed-end funds. The distribution date, amount of the last distribution, and the current distribution rate are also listed, with a listing for the taxable equivalent rate (applicable to the various tax-exempt closed-end funds). Funds can also be sorted based on these various category headings.
EASY AS E-T-F
The Find A Fund feature helps investors and traders look for the the specific funds or types of funds that they are interested in. If the ticker symbol is known, all an investor or trader need do is enter that symbol and click "Search." The result is a "Fund Quick Facts" page that lists closing Nav, closing share price, current distribution, premium/discount, 52-week high and low in net asset value, and 52-week high and low in share price.
The "Fund Basics" section reveals the fund category, sponsor, manager, symbol, inception date, inception NAV, and inception share price. The "Investment Objective" section provides a simple (and largely legalistic) explanation of the responsibilities and limitations of the fund. Below that is a line chart of share price and Nav history over the past year (or since inception, if preferred). Traders and investors can obtain specific monthly close data for the share price and the Nav by way of a "show chart data" link below the chart.
Fund Quick Facts is extensive. A performance history table provides information on calendar year and annualized total returns for both Nav and share price. Below that, a "Sector and Holdings Summary" lets investors and traders know what the fund consists of, along with data on the percentage of the total portfolio each issue represents. Pie charts indicating both industry and country diversification (if applicable) are underneath, as are tables listing various creation/redemption features (such as redemption fees), and a table of "ETF Facts" such as whether the fund is marginable, option tradable, or can be sold short. Finally, the page includes an "Other Portfolio Data" table that includes information about shares outstanding, total common and net assets, net asset value per share, and more.
Back to the Find A Fund page. Search for a single fund or use the "multifund search" to analyze more than one fund at a time. The single fund search uses a set of pulldown menus for index exchange traded funds, closed-end funds, and auction rate preferreds, while the multifund search uses checkboxes. Both searches will take investors and traders in Etfs to that same, thorough Fund Quick Facts page previously mentioned.
SPONSORS, LINKS AND LEARNING
The Fund Sponsors tab consists of a pair of pulldown menus that investors and traders can use to find out what types of funds -- ETFs or closed-end funds -- different sponsors provide. More than 100 different sponsors and trust administrators are listed as of this writing, from Aberdeen Asset Management to Western Asset Funds. The Fund Sorter tab brings up a screener that also uses a pair of pulldown menus to help investors and traders find ETFs and closed-end funds based on premium, discount, current distribution rate, taxable equivalent rate, size, YTD market return, and YTD NAV return.
Under Tools, visitors to ETFConnect.com can get access to the Fund Sorter, Portfolio Tracker, Current Market Summary, and the website's interactive charting tool. ETFConnect.com uses BigCharts.com's basic chart layout, with options to adjust time frame, as well as apply moving averages of varying durations and up to three technical indicators. The Portfolio Tracker comes courtesy of MarketWatch, and the Current Market Summary provides basic last, open, high, close, and changes data as well as the breadth-oriented Intraday Market Diaries featuring advancing/declining/unchanged issues, advancing/ declining volume and the number of issues at 52-week highs and lows for the NYSE, AMEX, and NASDAQ.
The Industry Links tab uses pulldown menus to provide easy access to more than 250 S&P Fund Reports, and websites oriented around exchange traded and closed-end funds such as CEFA (the Closed-End Fund Association) are accessible through an industry websites menu. Other pulldown menus provide links to various mainstream financial publications, exchanges where closed-end funds and exchange traded funds are traded, and closed-end and exchange traded fund statistics courtesy of the Investment Company Institute.
ETFConnect.com features a sizable Education Center, where those unfamiliar with closed-end funds and exchange traded funds can get basic (and not so basic) information. The Education Center is divided into four categories: Know Your Funds, frequently asked questions, a glossary, and a set of links to other financial resources including and not including information about closed-end and exchange traded funds (links to a REIT website and to the CBOE Learning Center, for example).
Know Your Funds is especially thorough, covering a wealth of topics that investors and traders in closed-end and exchange traded funds need to know, from legal structure to net asset value to investment risk and buying and selling. ETFConnect.com's glossary is also complete and extends beyond the world of closed-end and exchange traded funds.
There are a number of good websites on the Internet -- many of them sponsored by firms like Nuveen Investments -- that provide excellent, accurate information about closed-end and exchange traded funds. Some limit their information to those funds that they themselves sponsor, while others -- like ETFConnect.com -- strive to be more of an all-purpose resource for closed-end and exchange traded fund information. The website advertises itself as being a new and improved version with a "new layout, features and content." It will be worthwhile to see how ETFConnect.com grows as interest in and the market for closed-end and exchange traded funds grows in the years to come.
--David Penn, Technical WriterýETFConnect.com
alphatrends.blogspot.com
One of the blogs I try to read on a regular basis, equityinvestmentideas.blogspot.com, had a posting where author Yaser Anwar listed all the blogs and tools that he considered his favorites. In the technical analysis section within that list, one that was mentioned was Alpha Trends, mainly because of its excellent video posts. Curious because I'd never visited a technical analysis video blog, I clicked on it. Sure enough, Brian Shannon from MarketWise had several video posts of technical charts on his blog, alphatrends.blogspot.com.
Consider it the You Tube of technical analysis. Shannon discusses charts and draws trendlines, points out various scenarios on the charts, literally walks you through several charts, and gives you a condensed version of what he sees in these charts. You essentially get one-on-one tutoring with him. Some days he will discuss trading ideas; sometimes he gives a general review of the stock market, and other times he will discuss the stock of the day on Wallstrip, another blog (the review of which we will save for another issue). When discussing trading ideas, Shannon will at times suggest what price at which to enter a trade, where to place the stop-loss, and where the price target should be. In his review of the stock market, he mostly discusses the broader indexes but discusses relevant stocks as well.
Shannon doesn't tell you what to trade, but he teaches you how to apply technical analysis by walking you through several examples in each posting. He points out where the pullbacks are, where the market may be indecisive, the support/resistance levels, and where to be cautious or aggressive. There are times when he will discuss certain trades MarketWise was involved in and identify where the trade was placed, where the stop-loss was, and where the exit was. He uses this as a plug for the course he offers at MarketWise, which is where he will teach you how to identify these setups.
Although you may have to take one of the courses Brian Shannon offers at MarketWise, you still can learn a lot from viewing the videos posted on this site. And given that it is a blog, you'll find other features that are quite entertaining, especially from some of the links that are listed as well as personal stories of tech gadgets. I can guarantee that chartists will find this blog entertaining and interesting.
--Jayanthi Gopalakrishnan, EditorýAlphaTrends.blogspot.com