Theme-Based Investing by Leslie N. Masonson
Are you interested in learning more about using exchange traded funds (ETFs) in your trading? Leslie N. Masonson, an active ETF trader, is president of Cash Management Resources, a financial consulting firm that focuses on ETF strategies. He is the author of Buy—Don’t Hold: Investing With ETFs Using Relative Strength To Increase Returns With Less Risk; and All About Market Timing, as well as Day Trading On The Edge. His website is www.buydonthold.com, where he writes a weekly blog. To submit topics for future columns, reach him at firstname.lastname@example.org.
Most investors and traders are familiar with the attributes and potential profit opportunities of investing a portion of their assets in sector mutual funds or ETFs such as the 11 Select Sector SPDRs. A more dynamic entry into the ETF universe has emerged that may surpass sector investing as the next major ETF category. This new niche is known as thematic or theme-based ETFs and there are about 30 in existence at the present time. Think of them as subsets of sector funds. Moreover, they are future-looking ETFs trying to capture alpha from new technologies, environmental and climate changes, clean energy, artificial and robotic activity, aging population, cyber security, and other newly developing fields ...