joining us is matt hogan, editor of the exchange traded funds report. ma matt, good to e so you. we just had a long discussion about japan, how you short yen what is the best etf to express this view? >> yeah, actually a beautiful etf just for that, it's dxj is the ticker. the wisdom tree japan hedge currency etf. the problem with buying a traditional japanese equity etf is, you are inherently long the yen, which we all know is going to be driven down. dxj gives you that good upside exposure but shorts out the yen exposure. you get the best of both words. definitely a solid pick for next year. >> and your other four picks for 2013, they have to do with the merging markets. that seems to be the hot trend right now. let's talk about the one that tracks debt. >> i think this is a no brainer. you get better balance sheets, better growth and a significantly higher yield. i mean significantly. if you look at a u.s. government bond etf yielding less than 1%, this emerging market local current sill etf is yielding 5%. i think this is a trade, probably not just for next year, but for the

let's bring in matt hogan from index university. matt, great to have you with us.nt out that there really aren't great etfs to place special dividends. in terms of the dividend universe, which ones should people be looking at? >> mostly the special dividend story is out. no big surprise. you have to think what comes next? what's the hangover. the hangover is the additional buy backs by companies. next year they're going o spend less money on dividends, more money on buy backs. there's pkw. holds stocks and have bought back a lot of their securities. i think those could come hot with investors. that's a meaning that could catch on. that's one of the etfes to play the dividend space a different way. >> what is the did i have depd criteria. if a company is already an active buyer of its own shares don't you want to play that tab beginningal company that may be issuing a special dividend now but will change their policy once tax policy changes next year so therefore switch from a dividend to a buy back. >> that's right. it only holds stocks that sold back 5% of their s

matt hogan here moderating a conference master of all things etfs. continuing to see money going in. what's going on? why is etf so high? >> a couple of reasons. all the things we talk about, lower cost more cost efficient that's driving people into etfs. continue flows into the etfs out of mutual funds. >> you won't believe it, people keep moving out of stock mutual funds and into etfs overall. the money keeps flowing into that. why is that happening? >> i think there are two reasons. one, over time people have learned that active management doesn't work. they learn it didn't work in large caps, small caps, doesn't work in emerging markets. in the equity space you're better off buying index. >> taxable bonds, money goes into there. mutual funds and exchange traded funds. when is the bubble going to burst? >> you tell me. investors follow performance. as long as those things continue to do well, investors will jump in. the other thing we don't have in equity, we have two superstars, bill gross, jeff gunlock, knocking the cover off the ball. people li