Five More Tasty UltraShort ETFs

In yesterday's blog I mentioned five ultrashort ETFs that look especially compelling under current market conditions. However, I feel that five just isn't enough choice for a hungry bear so I'm introducing five more that I find particularly attractive. But beware! One of them is the ultrashort basic materials fund that has leapt up 10% just today. What this means is that if you want to buy it but are already holding some stocks in the materials sector, you'll be working at cross-purposes. To avoid being looked upon as a schizophrenic by your broker, this might be a good time to take your profits and exit your long positions.

Okay, here are today's picks.

More Ultrashort ETFs
(Note: Prices quoted are current at the time of writing.)

Materials (Ultrashort/Long): SMN($32.30)/XLB($40.) The materials sector has had a great run-up but has been running out of gas since May 19th, the bear market tipping point. The XLB broke major support a couple of days ago at $42 and is making a beeline for its next support line at $38. This translates into a 10% move in the SMN placing it right at its next resistance area at $35.

Semiconductors (Ultrashort/Long): SSG($68.80)/SMH($29.10) The semi's have dropped by 17% since mid-May and are heading down towards their major support level at $28. Assuming that happens, we can expect a corresponding 8% rise in the SSG to the $74-$75 region. Note that if the SMH breaks $28, there's no telling how much further it might drop since it'll be flying without any safety net, at least until the next support level at $20.

Russell 2000 (Ultrashort/Long): TWM($81.20)/IWM($67.75) The death knell for the Russell 2000 sounded on June 5th, a couple of weeks later than for the rest of the market. The IWM is sliding toward its next support level at about $64.50, and if it reaches that, the TWM will have gained roughly 10% to $89.

Emerging Markets (Ultrashort/Long): EEV($79.50)/EEM($132.) The long ETF, the EEM, has been an outstanding performer since its inception in 2003, chalking up a 380% gain at its October 2007 peak. Since then, it's been in a decline and put in what appeared to be a double bottom in January and March. But like most of the overall market, it rolled over on May 19th and appears to be heading towards its $126 support level. If it can accomplish that, the EEM will be on track to reach the $87 level for a 9% gain.

S&P Midcap 400 (Ultrashort/Long): MZZ($57.80)/MDY($146.70): The chart pattern for the S&P 400 is very similar to the that of the Russell 2000 (probably because they both are composed of smaller-cap stocks). The MDY peaked on June 5th. The next stop looks to be where it put in its double bottom in the $135 area. This will give us a target price of $67 on the MZZ for roughly a 16% gain.

From among these ten ETFs (including the five mentioned yesterday), even Papa, Mama, and Baby Bear should be able to find a few things that suit their palates. If you're finicky and don't like what you see here, there's plenty more tempting ultrashort funds on the menu, but please, no whining. Goldilocks is in no mood for grumbling!

FYI: I said yesterday that I didn't know how many ETFs are currently being offered. According to MSN Moneycentral, there are 742 funds on their ETF list.