THE ETF Investor Guide

Transcription

1 MUTUAL FUND Investor Guide THE ETF Investor Guide mutualfundinvestorguide.com FEBRUARY 2015 Matthew D. Sauer Founder & Chief Investment Officer Matthew Sauer is the Founder and Chief Investment Officer of the Mutual Fund Investor Guide family of newsletters. Each month he analyzes and provides buy, sell and hold recommendations for hundreds of mutual funds and ETFs in three newsletters: The Investor Guide to Fidelity Funds, The ETF Investor Guide and The Investor Guide to Vanguard Funds. Prior to starting the Mutual Fund Investor Guide, Matthew was President and Chief Investment Officer of the Fidelity Independent Adviser, ETF Report & Sector Momentum Tracker newsletters. IN THIS ISSUE 1 Perspective 2 Portfolio Updates 3 Model Portfolios 5 Data & Rankings 15 AdvisorShares TrimTabs Float Shrink (TTFS) Market Perspective: S&P 500 Rallies to New High on Strong Earnings and Economic Data The S&P 500 Index and Russell 2000 Index closed at all-time highs on February 13. The entirety of the move into record territory came in the first two weeks of February following strong U.S. economic data. The mood surrounding Greece s bailout negotiations also improved, thinning a cloud that has been hanging over the market for weeks. The Dow Jones Industrial Average finished very close to its all-time high. The Nasdaq is still below its high, set back in 2000, but it has been a market driver thanks to strong earnings. Apple (AAPL) reported the largest quarterly profit of any publicly traded company in history, raking in $18 billion in the fourth quarter as the strong dollar failed to deter global iphone fans. The month also closed with a strong earnings report from Cisco (CSCO) that gave a second wind to the rally in technology shares. Strong job and wage growth were two big positives for the markets over the past month. Since late 2014, the economy has gone through one of its best stretches of job creation since the 1990s, while wage growth is at its strongest since the 2008 crisis. GDP growth was decent in the fourth quarter, but we re likely to see those numbers reduced at the end of February when the second estimate is announced. The first estimate announced at the end of January noted fourth quarter GDP growth at 2.6 percent, but much of that growth came from the Bureau of Economic Analysis estimating strong increases in inventories. In February, the actual data came out and showed inventory growth was almost flat. When companies add to inventories, GDP growth increases, and when they reduce inventories, it subtracts from GDP. Roughly 0.8 percent of the 2.6 percent estimated growth last quarter was based on estimated inventory growth. On the bright side, inventory growth fluctuates, and we may see a pickup over the coming months, which will help GDP in European data also improved, with the eurozone s GDP growth for the fourth quarter beating estimates. The real winner was Germany, which saw its GDP increase 0.7 percent from the prior quarter and benefited from a weak euro due to its large export sectors. Low oil prices are also good news for the eurozone, since the region produces very little oil. There have been some concerns though, considering the Swiss National Bank ended its peg to the euro. The fallout continues to spread in Europe, with Denmark cutting its interest rates to below zero, low enough that at least one bank is offering negative interest mortgages. This week, Sweden s Riksbank cut interest rates below zero as well, as these nations try to stop capital from flowing into their non-euro currencies. The outstanding issue is the Greek sovereign debt crisis, which has yet to reach a resolution. Prior bailouts added more debt to an already unsustainable amount, but it only worked to delay a crisis for five years. Europe may yet add more debt to Greece s already dire situation and kick the can down the road once again, or it may finally work toward a solution. Whatever happens with Greece, it will serve as a precedent for other debtor nations such as Spain and Italy. An anti-austerity party has jumped into the lead in Spain, with elections in December. If Greece gets a new deal, Spain will want the same. Heading into the middle of the month, Greece was toning down its rhetoric. The Germans appeared willing to make an example of the Greeks and push them out of the eurozone if need be. Since the Greek people and the current government wish to remain in the eurozone, they are the ones with the weakest hand. Any deal is good news for the markets in the short term because investors were starting to price in a Greek exit from the eurozone. Domestically, earnings season continues to deliver solid results. Through mid-month, 391 companies out of the S&P 500 had reported earnings. FactSet Research reports that the earnings growth rate from these firms, plus the estimates on the firms yet to report, was 3.1 percent, faster than the 1.7 percent growth predicted at the start of As you might guess, the energy sector is responsible for most of the weakness in earnings, while healthcare and telecom pulled profits higher. Nearly 80 percent of companies are beating their earnings estimates. Apple (AAPL), General Motors (GM) and Cisco (CSCO) are some of the firms that have beaten estimates and pulled the market higher in the process. The current quarter appears mixed as energy continues to struggle. Companies that have given guidance for first quarter earnings in 2015 have been negative by a ratio of 6 to 1. Analysts have been lowering their estimates as well, and the current drop in (continued on page 2) 1

2 THE ETF Investor Guide Market Perspective: S&P 500 Rallies to New High on Strong Earnings and Economic Data (continued) estimates is the largest since The market is holding up well because nearly all of these reductions are coming from the energy sector. That sector s first quarter earnings estimates are down nearly 50 percent, worse than in In terms of sector performance, energy rebounded strongly in February. The decline in earnings estimates is baked into stock prices, and the rebound in oil prices, if it holds, may lead analysts to change their negative forecasts for the energy sector. Another sector performing well is financials. The sector struggled in early 2015 due to falling interest rates, but the past couple of weeks have seen interest rates move sharply higher. Portfolio Updates The month ending February 15 was positive for the markets, but all of the gains came over the last two weeks. The S&P 500 Index gained 5.24 percent for the month, and year to date it is up 1.85 percent. The Dow Jones Industrial Average saw similar results, up 4.03 percent on the month and 1.10 percent in The Nasdaq has been stronger thus far; it rallied 7.07 percent last month and is up 3.33 percent this year. The Russell 2000 climbed 5.93 percent in the prior month and has gained 1.53 percent this year. The MSCI EAFE, boosted by the launch of European quantitative easing, increased 5.41 percent last month, lifting the 2015 return to 3.63 percent. We will make one change to the portfolios this month. We will sell FirstTrust ISE Revere Natural Gas (FCG) and purchase Utilities Select SPDR (XLU) with the proceeds. XLU suffered one of its worst losses in history on a relative basis, trailing the S&P 500 Index by more than 10 percent over the past two weeks. This was an overreaction by traders in the wake of higher interest rates. Utilities and real estate have headed in the other direction. Those two sectors had been among the best performers to start the year, but the shift in interest rates has led to a reversal of fortune. Dividend paying ETFs and other high yielding sectors also lagged. It s too early to tell if the rebound in interest rates is a long-term move or a short-term bounce though, given the very large decline in interest rates that came in the prior month. The 10-year Treasury went from a yield of 2.3 percent at the end of December to a yield of 1.7 percent by the start of February, before sharply bouncing to 2.0 percent. The ETF Aggressive Sector Portfolio increased 4.64 percent over the past month and is up 3.02 percent this year. Technology has been the best sector to date, thanks to an earnings driven rally. ishares North American Software (IGV) climbed 9.07 percent last month, leading the portfolio by a wide margin. Defensive sectors such as consumer staples lagged, with Consumer Staples Select SPDR (XLP) up only 1.27 percent on the month. Year to date, the performance for staples is stronger though, since shares did well early in the year. The ETF Straight Growth Portfolio gained 5.05 percent last month, led by a 6.97 percent advance in Rydex S&P Mid- Cap 400 Pure Growth (RFG). Growth certainly saw the best returns last month, but the normally defensive ishares U.S. Pharmaceuticals (IHE) also continued its strong run. It climbed 6.80 percent last month, helping lift the healthcare sector. Vanguard Dividend Appreciation (VIG), which has a growth tilt, climbed 4.07 percent. ishares Core High Dividend (HDV) lagged with a 2.98 percent return. Dividend payers were hurt by the spike in interest rates. The ETF Balanced Growth Portfolio increased 3.05 percent last month and is up 2.13 percent this year. Guggenheim S&P 500 Pure Growth (RPG) rallied 6.48 percent and delivered a large chunk of the portfolio s gains. ishares High Dividend (HDV) rallied 2.98 percent, and SPDR Barclays Convertible Securities (CWB) advanced 3.72 percent. ishares High Yield Corporate Bond (HYG) rebounded 2.53 percent as investors returned to the sector in search of income. The ETF Conservative Income Portfolio increased 2.66 percent last month, lifting the 2015 return to 1.64 percent. This income oriented portfolio delivered a solid result considering it has nearly 20 percent of assets in PIMCO Enhanced Short Maturity (MINT). ishares S&P 500 Index (IVV) The markets have several things working in their favor: strong earnings, solid GDP growth and Europe showing some positive signs with the central bank providing a quantitative easing plan. Working against the market is Greece to some degree, which could be a nonissue soon, and the slowdown in China, which could weigh on the global economy later in the year. Higher oil prices would be good news for the market here, since it would lift the energy sector, signal the slowdown in China is stabilizing and alleviate fears of widening deflation. While the markets have been volatile over the first six weeks of 2015, the outlook remains positive for the considerable future. delivered about one-quarter of the portfolio gains last month thanks to its 5.41 percent rally. ishares Core High Dividend (HDV) and ishares High Yield Corporate Bond (HYG) each contributed moderate gains. The ETF Global Portfolio popped 6.69 percent last month and is up 5.22 percent in WisdomTree Europe Hedged Equity (HEDJ) rallied 9.21 percent and is up percent this year. The European Central Bank s decision to launch quantitative easing has boosted stocks while sending the euro lower, which is the exact situation HEDJ is designed to thrive in. The rest of the portfolio did well too thanks to strength in the developed markets. Behind HEDJ, PowerShares International Dividend Achievers (PID) was the next best performer, up 6.15 percent for the month. The ETF Aggressive Value Portfolio gained percent last month and is up 4.47 percent in Oil finally rebounded, and that lifted three of the holdings to sizable gains. Market Vectors Russia (RSX) gained percent, aided by its heavy exposure to energy firms. The gains have come even without a rebound in the ruble, which remains near its 52-week low. Vanguard European Stock (VGK) and Vanguard Information Technology (VGT) were also in the eye of the bullish storm last month. The ETF Absolute Return Portfolio slipped 0.59 percent last month but remains up 0.89 percent this year. Utilities Select SPDR (XLU) was responsible for the portfolio s loss last month, as the fund slipped (continued on page 16) 2 FEBRUARY 2015 PHONE: (888)

3 Model Portfolios (Data provided as of 2/15/15) ETF AGGRESSIVE SECTOR PORTFOLIO Ticker Name Price Shares Allocation 1-Month YTD Value IYK ishares US Cons Non-Cyc % 3.13% 1.81% $16, XBI SPDR Biotech % 5.88% 9.09% $18, IGV ishares NA Software % 9.07% 4.06% $19, FHLC Fidelity MSCI Healthcare % 2.86% 3.92% $35, XLP Cons Staples Select SPDR % 1.27% 2.08% $25, IYF ishares US Financial % 5.18% -0.21% $35, XLK Technology Select Sect SPDR % 6.65% 3.14% $27, TOTAL % 4.64% 3.02% $178, ETF STRAIGHT GROWTH PORTFOLIO Ticker Name Price Shares Allocation 1-Month YTD Value HDV ishares Core High Dividend % 2.98% 2.16% $52, VIG Vanguard Div Appreciation % 4.07% 1.52% $30, SPY SPDR S&P % 6.01% 2.64% $20, IHE ishares DJ US Pharma % 6.80% 7.98% $38, RFG Rydex S&P MidCap 400 Pure % 6.97% 4.52% $28, TOTAL % 5.05% 3.76% $170, ETF BALANCED GROWTH PORTFOLIO Ticker Name Price Shares Allocation 1-Month YTD Value HDV ishares Core High Dividend % 2.98% 2.16% $61, RPG Gugg S&P 500 Pure Growth % 6.48% 3.31% $20, HYG ishares High Yield Bond % 2.53% 2.53% $25, MINT PIMCO Short Maturity % 0.06% 0.06% $20, CWB SPDR Barc Convertible Secs % 3.72% 7.08% $17, TOTAL % 3.05% 2.13% $145, ETF CONSERVATIVE INCOME PORTFOLIO Ticker Name Price Shares Allocation 1-Month YTD Value HDV ishares Core High Dividend % 2.98% 2.16% $38, HYG ishares High Yield Bond % 2.53% 2.36% $41, IVV ishares S&P 500 Index % 5.41% 2.13% $18, MINT PIMCO EnhShort Maturity % 0.06% 0.06% $25, CWB SPDR Barc Convertible Secs % 3.72% 7.08% $11, TOTAL % 2.66% 1.64% $135, ETF GLOBAL PORTFOLIO Ticker Name Price Shares Allocation 1-Month YTD Value HEDJ WTree Europe Hedged % 9.21% 10.95% $36, PID PwrShrs Int'l Divid Ach % 6.15% 4.51% $41, IOO ishares S&P Global % 5.27% 3.32% $27, IDV ishares DJ Intl Select Div % 5.91% 5.25% $36, TOTAL % 6.69% 5.22% $142, ETF AGGRESSIVE VALUE PORTFOLIO Ticker Name Price Shares Allocation 1-Month YTD Value IJR ishares Core Small Cap % 5.91% 1.59% $28, XLU Utilities Select Sector SPDR % N/A N/A $13, DBE PwrShrs DB Energy % 14.82% -0.23% $10, VGT Vanguard Info Tech % 7.46% 3.41% $36, VGK Vanguard European Stock % 6.82% 4.87% $13, RSX Market Vectors Russia % 22.87% 23.38% $10, TOTAL % 10.32% 4.47% $112, ETF ABSOLUTE RETURN/DOWN MARKET PORTFOLIO Ticker Name Price Shares Allocation 1-Month YTD Value XLP Cons Staples Select SPDR % 1.27% 2.08% $21, XLU Utilities Select Sector SPDR % -6.29% -4.34% $13, IAU ishares Comex Gold % -2.38% 3.93% $9, UUP PwrShrs DB Dollar Bullish % 1.76% 3.92% $16, MINT PIMCO Short Maturity % 0.06% 0.06% $32, TOTAL % -0.59% 0.89% $93, FEBRUARY

4 THE ETF Investor Guide Data & Rankings (Data provided as of 2/15/15) % Return (3 and 5 Years Annualized) Symbol Name NAV Rank Advice YTD 1 Month 3 Month 1 Year 5 Year LARGE CAP GROWTH FTC First Trust Large Cap Gr AlphaDEX ETF Buy IUSG ishares Core US Growth Hold IVW ishares S&P 500 Growth Strong Buy IWF ishares Russell 1000 Growth Buy JKE ishares Morningstar Large-Cap Growth Buy MGK Vanguard Mega Cap Growth ETF Buy ONEQ Fidelity Nasdaq Composite Tr Stk ETF Buy PWB PowerShares Dynamic Large Cap Growth ETF Buy QQEW First Trust NAAQ-100 Equal Wtd ETF Buy QQQ PowerShares QQQ ETF Strong Buy QQXT First Trust NAAQ-100 ex-tech Sect ETF Buy RPG Guggenheim S&P 500 Pure Growth ETF Strong Buy SPYG SPDR S&P 500 Growth ETF Strong Buy VUG Vanguard Growth ETF Buy LARGE CAP BLEND DGRO ishares Core Dividend Growth Buy DSI ishares MSCI KLD 400 Social Buy EPS WisdomTree Earnings 500 ETF Buy EXT WisdomTree Total Earnings ETF Buy FEX First Trust Large Cap Core AlphaDEX ETF Buy ITOT ishares Core S&P Total US Stock Mkt Buy IVV ishares Core S&P Strong Buy IWB ishares Russell Buy IWL ishares Russell Top Buy IWV ishares Russell Buy IYY ishares Dow Jones US Buy JKD ishares Morningstar Large-Cap Buy KLD ishares MSCI USA ESG Select Buy MGC Vanguard Mega Cap ETF Buy MOAT Market Vectors Mstar Wide Moat ETF Strong Buy OEF ishares S&P Buy ONEK SPDR Russell 1000 ETF Buy PBP PowerShares S&P 500 BuyWrite ETF Buy PFM PowerShares Dividend Achievers ETF Buy PKW PowerShares Buyback Achievers ETF Hold PXLC PowerShares Fundamental Pure Lg Core ETF Buy RSP Guggenheim S&P 500 Equal Weight ETF Buy SPHQ PowerShares S&P 500 High Quality ETF Strong Buy SPY SPDR S&P 500 ETF Strong Buy THRK SPDR Russell 3000 ETF Buy VIG Vanguard Dividend Appreciation ETF Strong Buy VTI Vanguard Total Stock Market ETF Hold VV Vanguard Large-Cap ETF Buy XLG Guggenheim Russell Top 50 Mega Cap ETF Buy LARGE CAP VALUE CVY Guggenheim Multi-Asset Income ETF Hold DEF Guggenheim Defensive Equity ETF Strong Buy DHS WisdomTree Equity Income ETF Buy DIA SPDR Dow Jones Industrial Average ETF Buy DLN WisdomTree LargeCap Dividend ETF Buy DTD WisdomTree Total Dividend ETF Buy DTN WisdomTree Dividend ex-financials ETF Buy EZY WisdomTree LargeCap Value ETF Buy FDL First Trust Morningstar Div Leaders ETF Strong Buy FTA First Trust Large Cap Val AlphaDEX ETF Buy FEBRUARY 2015 PHONE: (888)

5 % Return (3 and 5 Years Annualized) Symbol Name NAV Rank Advice YTD 1 Month 3 Month 1 Year 5 Year LARGE CAP VALUE (continued) FVD First Trust Value Line Dividend ETF Strong Buy HDV ishares Core High Dividend Strong Buy IUSV ishares Core US Value Buy IVE ishares S&P 500 Value Buy IWD ishares Russell 1000 Value Buy IWX ishares Russell Top 200 Value Buy JKF ishares Morningstar Large-Cap Value Buy MGV Vanguard Mega Cap Value ETF Strong Buy PRF PowerShares FTSE RAFI US 1000 ETF Buy PWV PowerShares Dynamic Large Cap Value ETF Buy RWL RevenueShares Large Cap ETF Buy Y SPDR S&P Dividend ETF Strong Buy SPYV SPDR S&P 500 Value ETF Buy USMV ishares MSCI USA Minimum Volatility Strong Buy VOOV Vanguard S&P 500 Value ETF Buy VTV Vanguard Value ETF Buy VYM Vanguard High Dividend Yield ETF Strong Buy MID CAP GROWTH DWAQ PowerShares DWA NAAQ Momentum ETF Hold FAD First Trust Multi Cap Gr AlphaDEX ETF Hold IJK ishares S&P Mid-Cap 400 Growth Hold IWP ishares Russell Mid-Cap Growth Buy JKH ishares Morningstar Mid-Cap Growth Buy MDYG SPDR S&P 400 Mid Cap Growth ETF Hold PDP PowerShares DWA Momentum ETF Buy PXMG PowerShares Fundamental Pure Mid Gr ETF Buy RFG Guggenheim S&P MidCap 400 Pure Gr ETF Hold VOT Vanguard Mid-Cap Growth ETF Buy MID CAP BLEND C Guggenheim Spin-Off ETF Hold EWRI Guggenheim Russell 1000 Equal Wt ETF Buy EWRM Guggenheim Russell MidCap Equal Wt ETF Buy EZM WisdomTree MidCap Earnings ETF Buy FNX First Trust Mid Cap Core AlphaDEX ETF Buy FVL First Trust Value Line 100 ETF ETF Hold IJH ishares Core S&P Mid-Cap Buy IWR ishares Russell Mid-Cap Buy JKG ishares Morningstar Mid-Cap Buy MDY SPDR S&P MidCap 400 ETF Buy NFO Guggenheim Insider Sentiment ETF Hold PWC PowerShares Dynamic Market ETF Hold RSCO SPDR Russell Small Cap Completeness ETF Hold TTFS AdvisorShares TrimTabs Float Shrink ETF Buy VO Vanguard Mid-Cap ETF Buy VXF Vanguard Extended Market ETF Buy MID CAP VALUE CZA Guggenheim Mid-Cap Core ETF Buy DON WisdomTree MidCap Dividend ETF Strong Buy DVY ishares Select Dividend Strong Buy FAB First Trust Multi Cap Val AlphaDEX ETF Buy IJJ ishares S&P Mid-Cap 400 Value Buy IVOV Vanguard S&P Mid-Cap 400 Value ETF Buy IWS ishares Russell Mid-Cap Value Buy JKI ishares Morningstar Mid-Cap Value Buy PEY PowerShares High Yld Eq Div Achiev ETF Strong Buy PXMV PowerShares Fundamental Pure Mid Val ETF Buy RPV Guggenheim S&P 500 Pure Value ETF Strong Buy RWK RevenueShares Mid Cap ETF Buy FEBRUARY

6 THE ETF Investor Guide 6 FEBRUARY 2015 PHONE: (888) % Return (3 and 5 Years Annualized) Symbol Name NAV Rank Advice YTD 1 Month 3 Month 1 Year 5 Year MID CAP VALUE (continued) SPHB PowerShares S&P 500 High ETF Buy VOE Vanguard Mid-Cap Value ETF Buy SMALL CAP GROWTH IJT ishares S&P Small-Cap 600 Growth Hold IWO ishares Russell 2000 Growth Hold JKK ishares Morningstar Small-Cap Growth Buy PXSG PowerShares Fundamental Pure Sm Gr ETF Hold RZG Guggenheim S&P SmallCap 600 Pure Gr Hold ETF SLYG SPDR S&P 600 Small Cap Growth ETF Hold VBK Vanguard Small-Cap Growth ETF Hold VTWG Vanguard Russell 2000 Growth ETF Hold SMALL CAP BLEND EES WisdomTree SmallCap Earnings ETF Hold FDM First Trust Dow Jones Sel MicroCap ETF Hold FYX First Trust Small Cap Core AlphaDEX ETF Hold IJR ishares Core S&P Small-Cap Hold IWC ishares Micro-Cap Hold IWM ishares Russell Hold JKJ ishares Morningstar Small-Cap Hold PRFZ PowerShares FTSE RAFI US 1500 Sm-Mid ETF Hold RWJ RevenueShares Small Cap ETF Hold SLY SPDR S&P 600 Small Cap ETF Hold VB Vanguard Small-Cap ETF Hold SMALL CAP VALUE DES WisdomTree SmallCap Dividend ETF Buy IJS ishares S&P Small-Cap 600 Value Buy IWN ishares Russell 2000 Value Buy JKL ishares Morningstar Small-Cap Value Buy PXSV PowerShares Fundamental Pure Sm Val ETF Hold PZI PowerShares Zacks Micro Cap ETF Hold RFV Guggenheim S&P MidCap 400 Pure Val ETF Buy RZV Guggenheim S&P SmallCap 600 PureVal ETF Hold SLYV SPDR S&P 600 Small Cap Value ETF Hold VBR Vanguard Small-Cap Value ETF Buy ALLOCATION AOA ishares Aggressive Allocation Hold AOR ishares Growth Allocation Hold IYLD ishares Morningstar Multi-Asset Income Buy COMMODITIES BAL ipath DJ-UBS Cotton SubTR ETN Sell CORN Teucrium Corn ETF Sell COW ipath DJ-UBS Livestock SubTR ETN Hold DBA PowerShares DB Agriculture ETF Sell DBC PowerShares DB Commodity Tracking ETF Sell DJP ipath DJ-UBS Cmdty TR ETN Sell GCC GreenHaven Continuous Commodity ETF Sell GSG ishares S&P GSCI Commodity-Indexed Trust Sell GSP ipath S&P GSCI Total Return ETN Sell JO ipath DJ-UBS Coffee SubTR ETN Sell RJI ELEMENTS Rogers Intl Cmdty TR ETN Sell SGG ipath DJ-UBS Sugar SubTR ETN Sell WEAT Teucrium Wheat ETF Sell COMMUNICATIONS FCOM Fidelity MSCI Telecommunication Svc ETF Buy IXP ishares Global Telecom Sell IYZ ishares US Telecommunications Hold PBS PowerShares Dynamic Media ETF Sell VOX Vanguard Telecommunication Services ETF Hold

7 % Return (3 and 5 Years Annualized) Symbol Name NAV Rank Advice YTD 1 Month 3 Month 1 Year 5 Year CONSUMER DISCRETIONARY BJK Market Vectors Gaming ETF Sell FDIS Fidelity MSCI Consumer Discret ETF Hold ITB ishares US Home Construction Hold IYC ishares US Consumer Services Buy PEJ PowerShares Dynamic Leisure & Entmnt ETF Hold PMR PowerShares Dynamic Retail ETF Hold PSCD PowerShares S&P SmCap Cnsmr Discret ETF Hold RCD Guggenheim S&P 500 Eq Wt Cons Discr ETF Hold RXI ishares Globl Consumer Discretionary Hold VCR Vanguard Consumer Discretionary ETF Buy XHB SPDR S&P Homebuilders ETF Hold XLY Consumer Discret Sel Sect SPDR ETF Sell XRT SPDR S&P Retail ETF Hold CONSUMER STAPLES CROP IQ Global Agribusiness Small Cap ETF Sell FSTA Fidelity MSCI Consumer Staples ETF Strong Buy FXG First Trust Cnsmr Staples AlphaDEX ETF Strong Buy IYK ishares US Consumer Goods Buy KXI ishares Global Consumer Staples Buy PBJ PowerShares Dynamic Food & Beverage ETF Strong Buy PSCC PowerShares S&P SmallCap Cnsmr Stapl ETF Buy PSL PowerShares DWA Consumer Staples Mom ETF Strong Buy RHS Guggenheim S&P 500 Eq Wt Cons Stapl ETF Strong Buy VDC Vanguard Consumer Staples ETF Strong Buy XLP Consumer Staples Select Sector SPDR ETF Strong Buy ENERGY AMJ JPMorgan Alerian MLP ETN Hold BNO United States Brent Oil ETF Hold DBE PowerShares DB Energy ETF Sell DBO PowerShares DB Oil ETF Sell ENY Guggenheim Canadian Energy Income ETF Hold FCG First Trust ISE-Revere Natural Gas ETF Sell FENY Fidelity MSCI Energy ETF Hold FXN First Trust Energy AlphaDEX ETF Sell GAZ ipath DJ-UBS Natural Gas SubTR ETN Sell GEX Market Vectors Global Alt Energy ETF Hold ICLN ishares Global Clean Energy Sell IEO ishares US Oil&Gas Explor&Prodtn Hold IEZ ishares US Oil Equipment&Services Sell IXC ishares Global Energy Sell IYE ishares US Energy Hold KOL Market Vectors Coal ETF Sell PBD PowerShares Global Clean Energy ETF Hold PBW PowerShares WilderHill Clean Energy ETF Sell PSCE PowerShares S&P SmallCap Energy ETF Sell PUW PowerShares WilderHill Prog Engy ETF Sell PXE PowerShares Dynamic Engy Explr&Prdtn ETF Sell PXI PowerShares DWA Energy Momentum ETF Hold PXJ PowerShares Dynamic Oil & Gas Svcs ETF Sell TAN Guggenheim Solar ETF Sell UNG United States Natural Gas ETF Hold UNL United States 12 Month Natural Gas ETF Hold USO United States Oil ETF Sell VDE Vanguard Energy ETF Hold XES SPDR S&P Oil & Gas Equipment&Svcs ETF Sell XLE Energy Select Sector SPDR ETF Hold XOP SPDR S&P Oil & Gas Explor & Prodtn ETF Hold FEBRUARY

8 THE ETF Investor Guide % Return (3 and 5 Years Annualized) Symbol Name NAV Rank Advice YTD 1 Month 3 Month 1 Year 5 Year FINANCIALS FNCL Fidelity MSCI Financials ETF Strong Buy FXO First Trust Financials AlphaDEX ETF Buy IAI ishares US Broker-Dealers Hold IAK ishares US Insurance Buy IAT ishares US Regional Banks Buy IXG ishares Global Financials Hold IYF ishares US Financials Strong Buy KBE SPDR S&P Bank ETF Hold KCE SPDR S&P Capital Markets ETF Hold KIE SPDR S&P Insurance ETF Hold KRE SPDR S&P Regional Banking ETF Buy PGF PowerShares Financial Preferred ETF Strong Buy VFH Vanguard Financials ETF Strong Buy XLF Financial Select Sector SPDR ETF Strong Buy HEALTHCARE FBT First Trust NYSE Arca Biotech ETF Strong Buy FHLC Fidelity MSCI Health Care ETF Strong Buy FXH First Trust Health Care AlphaDEX ETF Strong Buy IBB ishares Nasdaq Biotechnology Strong Buy IHE ishares US Pharmaceuticals Strong Buy IHF ishares US Healthcare Providers Strong Buy IHI ishares US Medical Devices Buy IXJ ishares Global Healthcare Strong Buy IYH ishares US Healthcare Strong Buy PBE PowerShares Dynamic Biotech & Genome ETF Strong Buy PJP PowerShares Dynamic Pharmaceuticals ETF Strong Buy PTH PowerShares DWA Healthcare Momentum ETF Buy RYH Guggenheim S&P 500 Eq Weight HC ETF Strong Buy VHT Vanguard Health Care ETF Strong Buy XBI SPDR S&P Biotech ETF Strong Buy XLV Health Care Select Sector SPDR ETF Strong Buy XPH SPDR S&P Pharmaceuticals ETF Strong Buy INDUSTRIALS EXI ishares Global Industrials Hold FIDU Fidelity MSCI Industrials ETF Buy FLM First Trust ISE Glb Engnrg And Const ETF Sell FXR First Trust Indtls/PrdcrDurbAlphaDEX ETF Hold GII SPDR S&P Global Infrastructure ETF Hold IGF ishares Global Infrastructure Hold ITA ishares US Aerospace & Defense Buy IYJ ishares US Industrials Strong Buy IYT ishares Transportation Average Buy PKB PowerShares Dynamic Building & Const ETF Hold PPA PowerShares Aerospace & Defense ETF Buy PRN PowerShares DWA Industrials Momentum ETF Hold PSCI PowerShares S&P SmallCap Industrials ETF Hold SEA Guggenheim Shipping ETF Sell VIS Vanguard Industrials ETF Buy XLI Industrial Select Sector SPDR ETF Buy MATERIALS & PRECIOUS METALS AGOL ETFS Physical Asian Gold Sell DBB PowerShares DB Base Metals ETF Sell DBP PowerShares DB Precious Metals ETF Sell DBS PowerShares DB Silver ETF Hold GDX Market Vectors Gold Miners ETF Hold GDXJ Market Vectors Junior Gold Miners ETF Hold GLD SPDR Gold Shares Hold GLDX Global X Gold Explorers ETF Hold FEBRUARY 2015 PHONE: (888)

9 % Return (3 and 5 Years Annualized) Symbol Name NAV Rank Advice YTD 1 Month 3 Month 1 Year 5 Year MATERIALS & PRECIOUS METALS (continued) IAU ishares Gold Trust Hold JJM ipath DJ-UBS Ind Metals SubTR ETN Sell JJP ipath DJ-UBS Prec Metals SubTR ETN Sell PALL ETFS Physical Palladium Sell PGM ipath DJ-UBS Platinum SubTR ETN Sell PPLT ETFS Physical Platinum Sell PSAU PowerShares Global Gold & Prec Mtls ETF Hold RING ishares MSCI Global Gold Miners Hold SIL Global X Silver Miners ETF Hold SLV ishares Silver Trust Hold WITE ETFS Physical White Metal Basket Sell NATURAL RESOURCES COPX Global X Copper Miners ETF Sell CU First Trust ISE Global Copper ETF Sell CUT Guggenheim Timber ETF Sell FIW First Trust ISE Water ETF Hold FMAT Fidelity MSCI Materials ETF Hold FXZ First Trust Materials AlphaDEX ETF Hold GNAT WisdomTree Global Natural Resources ETF Sell GRES IQ Global Resources ETF Sell HAP Market Vectors Natural Resources ETF Sell IGE ishares North American Natural Resources Sell IYM ishares US Basic Materials Hold LIT Global X Lithium ETF Sell MOO Market Vectors Agribusiness ETF Sell MXI ishares Global Materials Sell PAGG PowerShares Global Agriculture ETF Sell PHO PowerShares Water Resources ETF Hold PIO PowerShares Global Water ETF Hold PYZ PowerShares DWA Basic Materials Mom ETF Buy PZD PowerShares Cleantech ETF Sell REMX Market Vectors Rare EarthStrat Mtls ETF Sell RTM Guggenheim S&P 500 Eq Wt Materials ETF Hold SLX Market Vectors Steel ETF Sell URA Global X Uranium ETF Hold VAW Vanguard Materials ETF Buy WOOD ishares Global Timber & Forestry Sell XLB Materials Select Sector SPDR ETF Buy REAL ESTATE DRW WisdomTree Global ex-us Real Estate ETF Sell FFR First Trust FTSE EN Dev Mkts Rel Est ETF Hold FRI First Trust S&P REIT ETF Hold FTY ishares Real Estate Hold GRI Cohen & Steers Global Realty Majors ETF Hold ICF ishares Cohen & Steers REIT Sell IYR ishares US Real Estate Hold MORT Market Vectors Mortgage REIT Income ETF Hold PSR PowerShares Active US Real Estate ETF Hold REZ ishares Residential Rel Est Capped Buy ROOF IQ U.S. Real Estate Small Cap ETF Hold RWO SPDR Dow Jones Global Real Estate ETF Hold RWR SPDR Dow Jones REIT ETF Hold VNQ Vanguard REIT ETF Hold VNQI Vanguard Global ex-us Real Estate ETF Hold WPS ishares International Developed Property Sell TECHNOLOGY FDN First Trust Dow Jones Internet ETF Buy FTEC Fidelity MSCI Information Tech ETF Strong Buy FEBRUARY

10 THE ETF Investor Guide TECHNOLOGY (continued) % Return (3 and 5 Years Annualized) Symbol Name NAV Rank Advice YTD 1 Month 3 Month 1 Year 5 Year IGM ishares North American Tech Buy IGN ishares North American Tech-Multimd Ntwk Buy IGV ishares North American Tech-Software Strong Buy IXN ishares Global Tech Buy IYW ishares US Technology Strong Buy MTK SPDR Morgan Stanley Technology ETF Buy PNQI PowerShares NAAQ Internet Buy PSJ PowerShares Dynamic Software ETF Buy PTF PowerShares DWA Technology Momentum ETF Buy PXQ PowerShares Dynamic Networking ETF Buy QTEC First Trust NAAQ-100-Tech Sector ETF Buy SKYY First Trust ISE Cloud Computing ETF Hold SOXX ishares PHLX Semiconductor Buy TDIV First Trust NAAQ Technology Div ETF Strong Buy VGT Vanguard Information Technology ETF Strong Buy XLK Technology Select Sector SPDR ETF Strong Buy X SPDR S&P Semiconductor ETF Hold UTILITIES DBU WisdomTree Global ex-us Utilities ETF Hold FUTY Fidelity MSCI Utilities ETF Buy FXU First Trust Utilities AlphaDEX ETF Buy IDU ishares US Utilities Buy JXI ishares Global Utilities Hold PSCU PowerShares S&P SmallCap Utilities ETF Buy PUI PowerShares DWA Utilities Momentum ETF Hold RYU Guggenheim S&P 500 Eq Wt Utilities ETF Buy VPU Vanguard Utilities ETF Buy XLU Utilities Select Sector SPDR ETF Buy FOREIGN LARGE CAP ACWI ishares MSCI ACWI Hold ACWX ishares MSCI ACWI ex US Hold ADRD BLDRS Developed Markets 100 ADR ETF Hold CCXE WisdomTree Commodity Country Equity ETF Sell CWI SPDR MSCI ACWI ex-us ETF Sell DEW WisdomTree Global Equity Income ETF Hold DGT SPDR Global Dow ETF Hold DNL WisdomTree Global ex-us Dividend Gr ETF Hold DOL WisdomTree International LargeCp Div ETF Hold DOO WisdomTree Intl Div ex-fincls ETF Hold DTH WisdomTree DEFA Equity Income ETF Hold DWM WisdomTree DEFA ETF Hold DWX SPDR S&P International Dividend ETF Hold EFA ishares MSCI EAFE Hold EFAV ishares MSCI EAFE Minimum Volatility Buy EFG ishares MSCI EAFE Growth Hold EFV ishares MSCI EAFE Value Hold FDT First Trust Dev Mkts Ex-US AlphaDEX ETF Hold FGD First Trust Dow Jones Global Sel Div ETF Hold GWL SPDR S&P World ex-us ETF Hold HGI Guggenheim Intl Multi-Asset Inc ETF Hold IDV ishares International Select Dividend Hold IOO ishares Global Buy LVL Guggenheim S&P Global Div Opps Idx ETF Hold PID PowerShares Intl Div Achiev ETF Buy PIZ PowerShares DWA Developed Mkts Mom ETF Hold PXF PowerShares FTSE RAFI Dev Mkts ex-us ETF Hold RTR RevenueShares ADR ETF Hold IV Global X SuperDividend ETF Hold FEBRUARY 2015 PHONE: (888)