Morningstar Advisor - December/January 2012 - (Page 76)

By the Numbers: ETFs 50 Most-Popular Equity ETFs Morningstar’s analysis of exchange-traded funds now harnesses the rigorous, bottom-up research that our 100-plus equity analysts conduct in order to estimate the fair value of stock ETFs. By comparing our fair value estimate for an ETF’s portfolio with the fund’s market price, we can better gauge whether an ETF is cheap, dear, or reasonably priced. In so doing, we can help you profit from inviting opportunities as they arise. The table lists the 50 most-popular equity ETFs, ranked by assets under management. A Morningstar Valuation Rating of Undervalued means the ETF is trading at a significant discount to our estimate of its intrinsic worth. A rating of Overvalued means the ETF is trading at a significant premium to our fair value estimate. We rate Fairly Valued any ETF that trades in between. The fair value estimate is the aggregate, asset-weighted fair value of the stocks in an ETF portfolio that are under coverage by Morningstar equity analysts, divided by the ETF’s shares outstanding. Depending on the coverage rate, the fair value estimate may not include all of the stocks in the portfolio. As such, when calculating our estimate, we assume that all stocks not under coverage are trading at fair value. Morningstar’s exchange-traded securities team analyzes the fundamental attractiveness of hundreds of ETFs. Our extensive ETF research is available in Morningstar Principia, Office, and our new Analyst Research Centers. Name Morningstar Category Style Box Morningstar Rating SPDR S&P 500 SPY Vanguard MSCI Emerging Markets ETF VWO iShares MSCI EAFE Index EFA iShares MSCI Emerging Markets Index EEM iShares S&P 500 Index IVV PowerShares QQQ QQQ Vanguard Total Stock Market ETF VTI iShares Russell 2000 Index IWM iShares Russell 1000 Growth Index IWF SPDR Dow Jones Industrial Average DIA iShares Russell 1000 Value Index IWD iShares MSCI Brazil Index EWZ Market Vectors Gold Miners ETF GDX iShares S&P MidCap 400 Index IJH Vanguard REIT Index ETF VNQ SPDR S&P MidCap 400 MDY iShares Dow Jones Select Dividend Index DVY Vanguard Dividend Appreciation ETF VIG Technology Select Sector SPDR XLK SPDR S&P Dividend SDY Energy Select Sector SPDR XLE Utilities Select Sector SPDR XLU iShares FTSE China 25 Index Fund FXI iShares S&P SmallCap 600 Index IJR Vanguard MSCI EAFE ETF VEA iShares S&P 500 Growth Index IVW Vanguard FTSE All-World ex-US ETF VEU iShares Russell 1000 Index IWB iShares MSCI Japan Index EWJ Vanguard Growth ETF VUG iShares Russell Midcap Index IWR Market Vectors Agribusiness ETF MOO Consumer Staples Select Sector SPDR XLP Financial Select Sector SPDR XLF iShares MSCI Canada Index EWC Vanguard Value ETF VTV Health Care Select Sector SPDR XLV iShares S&P 500 Value Index IVE Vanguard Small Cap ETF VB iShares MSCI South Korea Index EWY iShares Russell 2000 Value Index IWN iShares Russell 2000 Growth Index IWO iShares MSCI Pacific ex-Japan EPP iShares Dow Jones US Real Estate IYR Vanguard Mid-Cap ETF VO JPMorgan Alerian MLP Index ETN AMJ iShares Russell 3000 Index IWV Industrial Select Sector SPDR XLI Vanguard Large Cap ETF VV iShares Russell Midcap Growth Index IWP Data as of Oct. 31, 2011 Large Blend Diversified Emerging Mkts Foreign Large Blend Diversified Emerging Mkts Large Blend Large Growth Large Blend Small Blend Large Growth Large Value Large Value Latin America Stock Equity Precious Metals Mid-Cap Blend Real Estate Mid-Cap Blend Large Value Large Blend Technology Large Value Equity Energy Utilities China Region Small Blend Foreign Large Blend Large Growth Foreign Large Blend Large Blend Japan Stock Large Growth Mid-Cap Blend Natural Res Consumer Defensive Financial Foreign Large Value Large Value Health Large Value Small Blend Pacific/Asia ex-Japan Stk Small Value Small Growth Pacific/Asia ex-Japan Stk Real Estate Mid-Cap Blend Equity Energy Large Blend Industrials Large Blend Mid-Cap Growth È È È È È É È Î É Ç Ç Ç É Ë Ë Ë Ê È É Ç Ç Ç Ç Ï È É È È È É Ë È È Ç È Ç È Ç Î Ç Í Ï È Ë Ë — È È È Ì ÙÙÙ ÙÙÙÙ ÙÙÙ ÙÙÙÙ ÙÙÙ ÙÙÙÙ ÙÙÙÙ ÙÙÙ ÙÙÙÙ ÙÙÙÙ ÙÙÙ ÙÙÙÙ ÙÙ ÙÙÙÙ ÙÙÙ ÙÙÙÙ ÙÙÙ ÙÙÙÙÙ ÙÙÙ ÙÙÙÙ ÙÙÙÙ ÙÙÙ ÙÙÙ ÙÙÙÙ ÙÙÙ ÙÙÙÙ ÙÙÙÙ ÙÙÙÙ ÙÙÙ ÙÙÙÙ ÙÙÙÙ ÙÙÙÙÙ ÙÙ ÙÙ ÙÙÙÙÙ ÙÙÙ ÙÙÙ ÙÙ ÙÙÙ ÙÙ ÙÙ ÙÙÙ ÙÙÙ ÙÙÙ ÙÙÙ — ÙÙÙÙ ÙÙÙ ÙÙÙÙ ÙÙÙ 76 Morningstar Advisor December/January 2012

Table of Contents for the Digital Edition of Morningstar Advisor - December/January 2012

Morningstar Advisor - December/January 2012
Letter From the Editor
Seduced by Complexity
Is China Exposure Important for a Portfolio?
A Niche Built on Trust
How to Find Your Client’s Investment Style
Taking the Long View
Consensus on Europe Elusive
Four Picks for the Present
Investment Briefs
Is Perception Reality for Active Managers?
Be Alert for Basic-Materials Bargains
Investment Boom Unsustainable
Digging Moats in China
Where China’s Domestic Companies Stand to Benefit
Arising Opportunities
China Strong Long Term
From Currency Manipulation to International Acceptance
The Keys to China’s Fortune
Wedgewood’s Lessons Pay Off
Reading the Evidence on Indexing
Scouting for Investments Abroad
Yield, Please (Hold the Europe)
Mutual Fund Analyst Picks
50 Most Popular ETFs
Undervalued Stocks With Wide Moats
China Fund Managers Eat Elsewhere

Morningstar Advisor - December/January 2012