ETF Talk: Let Hurricane Sandy Propel Your Portfolio Forward

Doug Fabian

Doug Fabian is known for his expert knowledge of ETFs, bear funds and enhanced index funds to profit in any market climate.

The physical destruction caused by Hurricane Sandy need not ruin your investment portfolio. In fact, home builders and home renovation big-box stores could benefit from the need to rebuild homes, office and apartment buildings and, in some cases, entire neighborhoods. One exchange-traded fund that I am eyeing that could ride the post-storm reconstruction wave of Hurricane Sandy is the iShares Dow Jones U.S. Home Construction Index Fund (ITB).

Not only does ITB feature the nation’s biggest publicly traded home building companies, it also includes Home Depot and Lowes. The iShares Dow Jones U.S. Home Construction Index Fund seeks investment results that correspond generally to the price and yield performance, before fees and expenses, of the Dow Jones U.S. Select Home Construction Index. Companies included in the fund should be among those to benefit the most from the post-storm construction efforts.

Media reports indicate that Hurricane Sandy could inflict a cost of $20 billion before its last remnants dissipate. If that estimate holds, Hurricane Sandy will rank as one of the ten most costly natural disasters in U.S. history.

The fund, which holds $1.450 billion in assets, is comprised mainly of home construction companies, 64.44%; but also features building materials and features firms, 17.09%; home improvement retailers, 13.66%; and furnishings companies, 4.63%. ITB’s top ten holdings feature an array of well-known construction, building materials and home improvement companies. They are: Lennar Corp., 9.70%; Pulte Group Inc., 9.61%; DR Horton Inc., 9.17%; Toll Brothers Inc., 8.30%; NVR Inc., 7.59%; Home Depot Inc., 4.55%; Ryland Group Inc., 4.09%; MDC Holdings Inc., 3.86%; Lowe’s Cos. Inc. 3.85%; and KB Home, 3.65%.

Exclusive  Ringing in Retail with This Fund

As the chart above shows, the ETF has been on the rise this year. With the latest disaster, I expect the fund to climb further in the weeks and months ahead as re-construction and renovation spending boost revenues and profits at the companies that ITB’s performance is designed to track.

If you want my advice about buying and selling specific ETFs, including appropriate stop losses, please consider subscribing to my Successful Investing newsletter. As always, I am happy to answer your questions about ETFs, so do not hesitate to email me by clicking here. You may see your question answered in a future ETF Talk.

share on:
share on:


Dr. Mark Skousen

Named one of the "Top 20 Living Economists," Dr. Skousen is a professional economist, investment expert, university professor, and author of more than 25 books.

Product Details

  • Forecasts & Strategies
  • Home Run Trader
  • Fast Money Alert
  • Five Star Trader
  • TNT Trader

Bryan Perry

A former Wall Street financial advisor with three decades' experience, Bryan Perry focuses his efforts on high-yield income investing and quick-hitting options plays.

Product Details

  • Cash Machine
  • Premium Income PRO (exclusively for subscribers of Cash Machine)
  • Quick Income Trader
  • Breakout Options Alert
  • Hi-Tech Trader

Jim Woods

Jim Woods has over 20 years of experience in the markets from working as a stockbroker,
financial journalist, and money manager. As well as a book author and regular contributor to
numerous investment websites, Jim is the editor of:

Product Details

  • Successful Investing
  • High Velocity Options
  • Intelligence Report
  • Bullseye Stock Trader
  • Eagle Eye Opener

Bob Carlson

Bob Carlson provides independent, objective research covering all the financial issues of retirement and retirement planning. In addition, Bob serves as Chairman of the Board of Trustees of the Fairfax County (VA) Employees’ Retirement System, which has over $2.8 billion in assets.

Product Details

  • Retirement Watch
  • Retirement Watch Spotlight Series
  • Lifetime Retirement Protection Program

Jon Johnson

Jon Johnson's philosophy in investing and trading is to take what the market gives you regardless if that is to the upside or downside. For the past 21 years, Jon has helped thousands of clients gain success in the financial markets through his newsletters and education services:

Product Details

  • Investment House Daily
  • Stock of the Week
  • Technical Traders Alert
  • Rapid Profits Stock Trader

Used by financial advisors and individual investors all over the world, is the premier provider and one-stop shop for dividend information and research.

Product Details

Popular tools include our proprietary Dividend Calendar, Dividend Calculator, Dividend Score Card, and many more.

  • Dividend Investor