Top Performing ETFs: 6 Options for Strong Returns

ETF performance can swing wildly from year to year, but emerging markets and commodities, and ultra short ETFs consistently constitute some of the best performing ETFs.

Russia

Russia has benefited from rising oil prices. It is also seeing better direct investment and decent growth. If the government shows a greater commitment to economic reform, the S&P rating firm might upgrade its sovereign debt rating. Invest in Russia with Market Vectors Russia.

Brazil

Economic stability and steady growth growth has fueled retail sales in this country. Brazil also has a blossoming middle class, stable democratic nation, a small reliance on exports and natural resource reserves that give the company a good buffer from global economic shocks. Invest in Brazil with the iShares MSCI Brazil Index.

The Rest of Latin America

There is more to Latin America than Brazil. The economies of Latin America are rich in natural resources. Peru is a big producer of metals such as copper, zinc, and silver. Chile is also a very large produce of copper. Columbia is a big exporter of  coal, oil, and coffee. Invest in Latin America Through SPDR S&P Emerging Latin America.

Turkey

Fitch ratings gives  Turkey’s sovereign debt a rating of BB+, the highest speculative grade. The World Bank gives it a strong economic forecast. Invest in Turkey with iShares MSCI Turkey Invest Mkt Index.

Indonesia

The Market Vectors Indonesia fund is a relatively new way to invest in the country. Indonesia has a growing workforce and a young population. It is he biggest exporter of palm oil, which is increasingly popular in China and India. Its GDP per capita growth is also quite strong.

China

China has been a key driver of asset rice appreciation. It has driven the resurgence of basic materials in countries like Chile, Brazil, Peru, and South Africa. It also buys Unites States Debt, keeping the U.S. system afloat. All of these things make China a good investment.

Commodities

• Coal: Coal is a surprisingly well performing ETF. However concerns over climate change legislation might  force you to think  twice before investing in this commodity. You can invest in coal through Market Vectors Coal, and Powershares Global Coal.

• Copper: A weak dollar and economic expansion in emerging and developed markets is good for the price of coal. Invest in copper with iPath Dow Jones AIG Copper TR Sub-Index ETN.

• Steel: When industrial demand is high, and automobile sales are strong, steel become s a good investment. You can invest in Steel through Market Vectors Steel.

UltraShort ETFs

Ultrashort ETFs benefit from volatile markets. Thus they are seen as “bearish” ETFs. These funds provide short exposure to a long position. If rates go up, then the Ultrashort ETF goes up. They are also designed to provide twice the exposure. If a long bond falls by 1.5% one day, the Ultrashort ETF will rise by about 3%. Invest in Ultrashort ETFs with UltraShort Lehman 7-10 year Treasury ETF, for example.