After looking at ETFs that are useful for gaining access to high-priced stocks we decided to go in a different and look for ETFs trading for under $20 that will exceed that psychologically important price barrier by the end of this year.
Obviously, that's working on the assumption stocks and riskier assets continue to move higher this year and we'll admit that some of the funds included here aren't a stretch to exceed $20 in the next nine months because they might be able to do it in 60 days or less.
Eliminated from this search were leveraged and inverse ETFs, bond funds and those ETFs with less than 50,000 share in average daily volume. This is what we came up with.
First Trust ISE-Revere Natural Gas Index Fund FCG
Talk about cracks in the armor. The First Trust ISE-Revere Natural Gas Index Fund was looking like it to breakout recently but March has been unkind to this ETF. A couple of more bad days for stocks and/or oil and FCG could turn negative on the year.
If FCG holds support at $18, it's a buy there and given that the ETF is loaded with companies that are increasing their oil output and that are potential takeover targets, FCG could be at $20 before Labor Day.
iShares MSCI Netherlands Investable Market Index Fund EWN
There are often gray areas in the world of investing, but when it comes to the iShares MSCI Netherlands Investable Market Index Fund EWN, the situation is black and white. No, the Netherlands isn't going to wow anyone with jaw-dropping GDP numbers. Yes, it's still a pretty dependable developed market. Yes, the Netherlands still has an AAA credit rating and yes, EWN is a buy if, and only if, Europe makes legitimate progress toward solving its sovereign debt woes.
"Solving" does not mean moving Greece to the back burner only to move Portugal, Spain or Italy to the front. If EWN can crack $19, $20 is on the table from there.
PowerShares DWA Emerging Markets Technical Leaders ETF PIE
Out bet on PIE slicing its way to $20 isn't derived from the fact that at just below $18, asking for an emerging markets ETF to go to $20 over nine months isn't asking for a lot. Rather, PIE's country allocations are appealing, including the 3.4% weight to Brazil, which is appealing because Brazil should probably be avoided for the time being.
Roughly three-quarters of PIE's slices go to Malaysia, South Korea, Mexico, Indonesia and Thailand. All look more attractive than Brazil right now and several will likely outperform China ETFs as well.
Global X China Consumer ETF CHIQ
This is the big stretch play on the list because the Global X China Consumer ETF is up about 25% from its October 2011 lows, but the ETF would need to rally another 25% to get to $20. Possible, but not probable unless China's stimulus efforts are the best batch of government stimulus since the Tennessee Valley Authority and related fare.
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