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IndexUniverse had kind of an odd profile of a European investment manager who uses ETFs. I would sum it up as a former very successful hedge fund manager now manages separate accounts with ETF and ETC but does not like ETNs. The results have been very good. There was no mention of what they actually do beyond using "passive funds in an active strategy."

There was also an interview with Dennis Gartman and in that interview reference was made to a filing that Gartman is involved with where AdvisorShares will list funds that denominate gold in GBP, EUR and JPY and there will be a fourth fund that will own the other three in a fund of funds product. Our firm subadvises the Global Alpha Beta ETF (RRGR) for AdvisorShares.

The first article isolates what is presumably a sophisticated strategy (really odd that the strategy doesn't even get a vague mention) and the second article provides examples of what should offer very specialized exposure for anyone so inclined to spend time understanding the dynamics underlying the relationships captured.

This is an idea I have circled back to many times which is creating portfolios with very narrow exposures along the lines of an all individual stock portfolio without any individual stocks just narrow ETFs. The big idea here is democratization for investors who wish to pursue this sort of portfolio that might include hydroelectric, Malaysian plantations or Norwegian fisheries--to pick from some narrow segments we've looked over the years.

The ETF industry is nowhere near the breadth of choice available that I am talking about but there are some funds that are this specialized. There is of course no guarantee that anything like this must do well. In theory they could all turn out to be like the solar ETFs which are both down more than 90% since their respective inceptions. In this context I have mentioned the PowerShares Water Portfolio (PHO) which we have owned since its inception. I would say it is a very specialized fund and since inception it has outperformed the SPY, XLU and XLI (the fund is heavy in utilities and industrials which is why mention XLU and XLI).

A lot of progress toward specialization in equities, fixed income and other asset classes and that will continue. The above profiled former hedge fund manager is achieving excellent returns using ETPs in what are presumably sophisticated strategies, again using products that any retail investor can access. If he can, than you can too depending on time available and interest in the task.