A Cool Nanotech ETF or NOT?

The big news from my perspective is the announcement of The PowerShares Lux Nanotech Index ETF which will begin trading soon. The good news is that this will be the first way for average Joe's and Jill's to invest in a broad portfolio of nanotechish stocks. The bad news is that (as much as I like and respect the folks and work done at Lux) they have to use the Lux Index, which was, maybe, a great first draft two or three years ago!

It makes little sense as a true index of nanotech stocks, and even less as an index for the larger category, small technology.

I've been thinking about an international, small tech index for nanotechnology.com for more than two years, and our work should be completed in the first quarter of 2006. The Merrill Lynch Nanotech Index, which I like much more, doesn't really impress either, but we consider the Powershares to be a poor approximation at best – 3M? Headwaters? Hewlett Packard? GE? IBM? NEC? et al.?

Perhaps Lux can't be blamed for profiting from work they did a couple years ago, but the PowerShares folks sure look foolish.

C'mon – the public and professional investors deserve better – way better; and we're going to give it to them.