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ETF Spotlight Newsletter
A sampling of research & data on ETFs from AltaVista Research
In This Issue
In This Issue
Chart of the week
Fund focus
Quick Links
Coverage at a glance
No. of ETFs
536

Total Mkt Cap ($bns)

$538.4

Avg. daily value traded ($bns)

$67.3
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June 7, 2010
Greetings!

Below please find the ETF Spotlight newsletter for the week of June 7, containing highlights of the research and data on www.etfresearchcenter.com as well as a recap of the past week's action in the ETF market. 

The focus of this week's edition is "safe" dividends. Feel free to share it with others who may be interested. 
 
In this week's issue

technician"Safe" dividends
  • Chart of the week: "Safe" dividend yields
  • Fund Focus: iShares MSCI United Kingdom (EWU)
  • Revisions, asset flows & short interest
  • DPS estimates, payout ratios and yields for major ETFs
  • Market monitor - movers & categories
To download the full newsletter click here.
 
Chart of the week
"Safe" dividend yields
High yields with at least 2:1 coverage
ChartOfWeek

During times of uncertainty particularly such as our current global economic situation investors have turned to dividends for safety and to wait out the storm. But sometimes the strategy can backfire when high yields reflect the likelihood dividends will be cut rather than a stream of steady income.

We've screened our universe of 536 ETFs for funds with the highest yields on 2011E DPS, but that also had a payout ratio of less than 50% (i.e., dividends less than half of earnings), as a measure of safety. This eliminated more than half the funds that would have made the cut without the additional safety screen. One of the funds on the list, the iShares MSCI United Kingdom (EWU) is this week's Fund Focus.

To download the full newsletter, click here.
 
Fund Focus
iShares MSCI United Kingdom (EWU)big ben

British companies are some of the most attractively valued among developed markets: EWU is dominated by multinationals that derive most of their sales from outside the U.K. (and should not be unduly affected by the country's economic woes) that, on average, achieve a higher ROE than their counterparts in the S&P500 yet trade at a considerably lower P/BV multiple. Note however the index is dominated by firms in the Financial and Energy sectors, including the troubled BP.


To download the full newsletter, click here.
 
As always your questions & feedback are most welcome.
 
Sincerely,
 
Michael Krause
AltaVista Research