Archive | ETF Philosophy

50% Recession Possibility Calls For A ‘Higher-Than-Usual’ Allocation To Non-Stock ETFs

Other than permanently bearish writers and investors, few address the possibility of the U.S. falling into a recession. Many conclude that the Federal Reserve’s ultra-low rate policy completely altered the landscape such that the idea of a business cycle no longer exists. Others merely ignore warning signs until, unfortunately for them, the opportunity to reduce [...] Continue Reading...


Are Transportation Stocks Hinting At A New Recession?

Is a recession around the corner? Some analysts believe the key to that answer resides with transportation companies like Federal Express (FDX), Union Pacific (UNP) and Ryder (R). Specifically, if less and less unfinished goods are being moved to manufacturers, wholesalers and retailers, then one might anticipate sluggish growth, or even economic contraction. How might one [...] Continue Reading...


Why A ‘Rate Hike Tantrum’ Will Not Kill Bond ETFs in 2015

The 10-year Treasury note is the most recognizable, and most important, debt instrument in the world’s financial system. It is vital to foreign jurisdictions, banks and investors as a way to gain exposure to the U.S. dollar as well as interest payments backed by the full faith and credit of the U.S. federal government. Stateside, [...] Continue Reading...


Technical Breakouts For Popular ETFs On The World Stage

The current bull market for U.S. stocks is the fourth longest in history. Two others journeyed into a seventh year, while one other (1990s) enjoys the distinction as having traveled into an eighth year. Even if one subscribes to the idea that “bull markets never die of old age,” probability alone suggests that we are [...] Continue Reading...


Three Implications Of “Shifts” In Fed Policy

A large number of stocks in the Dow Jones Industrials Average have moved lower since the¬†Federal Reserve ended its quantitative easing (QE) program in late October. Telecom giants AT&T (T) and Verizon (VZ) have toiled. Consumer champs Procter & Gamble (PG) and Coca-Cola (KO) have struggled. Commodity-related kings like Chevron (CVX) and Caterpillar (CAT)? They’ve [...] Continue Reading...


ETF Risk Management In The Face Of A Surging U.S. Dollar

Historically, when the U.S. dollar surges, forward S&P 500 earnings plummet. In the same vein, the last two times that the world’s reserve currency skyrocketed, the¬†U.S. economy slipped into a recession. Come on, Gary. Do you really think that we have already dipped into recession territory? No, I do not. Yet the idea that the Federal [...] Continue Reading...


King Dollar Up, U.S. Stocks Down: A Different Investing Dynamic For 2015

China, India, Indonesia, Russia, Canada, Sweden, Denmark. Those are just some of the nations that felt compelled to lower rates in 2015. Several rate-cutting countries may genuinely warrant stimulus to bolster economic activity. Others have engaged in currency depreciating tactics in reaction to electronic money creation by the Bank of Japan (BOJ) and European Central [...] Continue Reading...


Selling Winners In Your Portfolio Is Never Easy

It’s not an easy thing to sell an asset that you still believe has legs. I needed to reduce exposure to Vanguard Extended Duration (EDV)¬†for many of my clients, in spite of the reality that they were sitting on 14-plus months of remarkable capital appreciation and income gains. What transpired? The exchange-traded tracker hit a stop-limit [...] Continue Reading...


Everything Is Awesome? Time To Rethink Your ETF Asset Mix

Less than three months ago, analysts everywhere argued a case for economic acceleration. It was almost as if financial authorities big and small had held a convention at LEGOLAND in California to declare that, “Everything Is Awesome.” Everything is not awesome. Jobless claims hit 10-month highs, factory orders have dropped for six consecutive months, consumer spending [...] Continue Reading...


What the NASDAQ’s Round-Trip To 5000 Really Means

When the NASDAQ Composite Index hit 5000 in March of 2000, jubilant investors celebrated the milestone. Shortly thereafter, however, scores of individuals lost their collective shirts. Many witnessed losses of 50%, 60% or 80% of their account values on names like Cisco, JDS Uniphase and Pets.com. Back then, the euphoria was akin to unchecked greed. Today, [...] Continue Reading...


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