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Global equity markets raillied strongly in 2009, with resource-related equities leading the charge to the end of the year, and this has largely spilled over into 2010. Resource-related ETFs benefitting from cyclical recovery in the developed world and continued robust demand from key emerging market economies, particularly China have been the best performers.

Long-term structural factors remain strongly favourable for the resource sector as rising per capita incomes in large population emerging markets continues to drive demand for energy, metals, agriculture and related products.

The shorter-term cyclical outlook is less clear as extraordinary government fiscal and monetary stimulas programs are pared back and the consequences of rising debt levels in developed economies raises concerns about sovereign risks, potential growth set-backs and inflation.

ETF platforms provides investors with the flexibility to make positive returns whether markets rise or fall. In the first two months of 2010, as high uncertainty has been the dominant theme, short ETFs have performed strongly.

Source: ETF Securities