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Thursday, 08 November 2007 |
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By Jon Lewis
In these days of turbulence in U.S. markets, with the S&P 500 (SPX) battling the 1,500 mark, financials crumbling, CEO firings, earnings news mixed, it's nice every once in a while to look at a chart that has done nothing but move higher. It's a country exchange-traded fund (ETF) that you don't hear much about.
With most of the international attention focused on China, Brazil, and the like (and with good reason), one country has quietly made huge gains. But it's learned to live in the shadows, specifically those thrown by the U.S. Of course I'm referring to Canada. Look at the chart of the iShares Canada (EWC) ETF, which has steadily gained more than 350 percent over the past five years (the chart goes back only three years).
It's no wonder. The Canadian dollar (the loonie) is blowing the U.S. dollar way. It's hard to believe that it now takes $1.08 to buy one Canadian dollar. So much for the cheap trip up north. (Of course, U.S. border towns are bracing for a nice holiday season, thanks to their Canadian cousins.)
But it's the demand for Canada's huge cache of natural resources - oil (tar sands), timber, natural gas, and coal, among others - that's pumping up the Canadian economy. And that demand is not going to dissipate, especially with the rise in Asian consumption. So this is an uptrend that looks to have a long way to run.
Source : Investor's Daily Edge
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