The iShares 20+ U.S. Treasury Bond Fund (TLT) has often exhibited wider daily trading swings than the S&P 500 SPDR Trust (SPY). This quirk alone has made it difficult for me to embrace the long end of the treasury bond curve. Instead, I’ve been more apt to stick with intermediate investment grade corporate credit, as well as short-term and long-term high [...] Continue Reading...
Financial stocks rocketed ahead in the first quarter and Bank of America (BAC) recently received a high-profile upgrade. So why is the SPDR Select Sector Financials Fund (XLF) one of the worst performers over the last 5 days? Aluminum giant, Alcoa, surprised Wall Street with its stronger-than anticipated earnings report. So why is the SPDR Select Sector [...] Continue Reading...
We can all agree that the first 3 months were wonderful for risk takers. What’s more, we can all feel good that U.S. stocks ran at their fastest percentage clip since 1998. Of course, what happened in the summer of 1998 is pretty intriguing as well. The infamous hedge fund Long-Term Capital Management helped exacerbate the spread of an Asian currency [...] Continue Reading...
In the first two months of the year, SPDR Dow Jones Industrials (DIA) garnered 6.5% and the underlying benchmark made a successful run at 13000. It was a phenomenally fast start that persuaded many investors with cash on the sidelines to reconsider. Perhaps surprisingly, foreign stock ETFs dramatically outperformed domestic counterparts in January and February. For example, Vanguard Emerging Markets (VWO) raked [...] Continue Reading...
Chartists often like to view sector performance relative to the S&P 500 via a price ratio. For instance, if you are interested in basic materials stock momentum, you might investigate XLB:SPY over a particular period of time. In comparing price ratios for each of the 9 largest sector ETFs on 3/20/2012, only two can be said to be gaining [...] Continue Reading...
My clients have benefited from a healthy slice of exposure to risk in 2012. Top ETF holdings include assets like SPDR S&P China (GXC), Vanguard Dividend Growth (VIG), iShares High Yield Corporate (HYG) and Vanguard Growth (VUG). My income-oriented winners like JP Morgan Alerian MLP (AMJ) and PowerShares CEF Income (PCEF) have been noticably slower on the [...] Continue Reading...
There’s been a great deal of discussion about the NASDAQ’s ability to log an 11-year high this past week. What hasn’t been mentioned, however, is that the tech-heavy composite remains 42.5% below its 12-year high. In fact, the composite would need to pole vault 74% from the current 11-year peak to recover the losses incurred from the bursting of [...] Continue Reading...
In 2011, U.S. financial stocks collectively posted the worst performance of the 10 major economic segments. Not only did the SPDR Select Sector Financial Fund (XLF) decline 17%, but the P/E ratio for the sector contracted 22%. In 2012, the skies have been a little brighter for banks, insurers and property developers. The S&P 500 SPDR Trust (SPY) has [...] Continue Reading...
In 2011, S&P 500 profits expanded 15%. And yet, the benchmark’s price finished in the very same place that it started the year. In essence, since prices flat-lined and earnings experienced double-digit growth, a fundamentally inexpensive stock market via the price-to-earnings ratio (P/E) became even cheaper. The most common reason cited for P/E contraction in 2011? The Euro Zone debt crisis. Obviously, sovereign [...] Continue Reading...
Let’s face it. Maybe you weren’t cut out for volatility. And the stock market isn’t about to let you garner remarkable rewards in 2012… at least not without monstrous price swings. Can you turn to U.S. treasuries next year? Even if record-low yields didn’t rise, your return may not even keep up with inflation. It doesn’t look [...] Continue Reading...
