A seemingly endless string of interest rate hikes (unlucky 13) and bank reserve increases killed India ETFs in 2011. In fact, investors may not have feared inflation as much as they feared that the Reserve Bank of India would go too far. Yet a shift in central bank policy bias towards easing has given emerging market watchers reason to [...] Continue Reading...
Month-over-month, most sector investments have provided investors with ample capital appreciation. Country ETFs with ties to technology, energy and infrastructure have all performed admirably. Yet there are a variety of areas of weakness that cannot be disregarded as inconsequential. For instance, in my February commentary on underachievement in the transportation arena, I highlighted the concerns with the Dow Industrials Average [...] Continue Reading...
How do “value” gurus determine worth? Bill Miller spent 30 years at the helm of Legg Mason Value (LMVTX), buying companies that he believed were deeply discounted. This often meant that he would purchase shares of a company where the market had priced the shares less than what was on the accounting books; sometimes, he might acquire shares for less [...] Continue Reading...
In my 10/27/11 commentary, “3 Reasons Stock ETF Investors Should Continue To Tread Lightly,” I pointed to the fact that the month-long stock surge had not come from the spectacular earnings season; in fact, the average return for individual securities on the session following a Q3 earnings report was -0.21%, suggesting that the entire October run-up emanated from enthusiasm for pan-European cooperation. It follows that articles [...] Continue Reading...
The bear has been ruthless to investors in Chinese companies. For example, from an early November 2010 multi-year peak to an October 2011 valley, the iShares FTSE China 25 Fund (FXI) plummeted -36.6%. Since those October 3 lows, however, several facets of the Chinese “story” have become more favorable. First, analysts worldwide began upgrading China stocks [...] Continue Reading...
Since 7/25/2011, market participants have been dealing with extraordinary volatility. In fact, for the past 11 weeks, the CBOE Volatility Index (VIX) hadn’t closed below a 50-day moving average. Until now, that is. On 10/10/2011, the current price of the VIX closed below a key trendline. In a similar vein, the S&P 500 hadn’t closed above a 50-day MA since 7/27/2011. [...] Continue Reading...
Last month, the mere rumor that China was looking at purchasing Italian bonds sent stocks surging higher. However, it is far more likely that China will take a ”wait-n-see” approach. Consider the contentious nature of international trade and currency disputes between China and the developed world. In response to a widespread belief that China keeps its currency artificially low, the U.S. Senate has been advancing [...] Continue Reading...
Last October, enthusiasm for Brazil had reached epic proportions. And why not? Not only had the iShares MSCI Brazil Fund (EWZ) risen 175% off its November 2008 lows, but the country constitutes one of the essential building blocks in the BRIC (Brazil, Russia, China, India) fortress. Indeed, the country boasts the world’s 7th largest economy, a consumption-oriented middle [...] Continue Reading...
It’s one thing to claim that the stock market is pricing in Armageddon… that emotionality is trumping rationality. It’s another thing to dismiss investor fears as silly or absurd. Along these lines, the researchers at Bespoke published a fascinating table of “technically oversold” ETFs. In Analystville, one may regard an ETF as oversold when its current price is more [...] Continue Reading...
Short-sellers and program traders are in charge… for now. Going into Wednesday’s (8/3/11) session, PowerShares QQQ (QQQ) sat directly atop its 200-day moving average. After falling below the key trendline early, QQQ springboarded to finish with a 1% gain. Or consider the S&P 500 SPDR Trust (SPY). It fell precisely -10% from its April 29 intra-day high to its August 3 [...] Continue Reading...
