How many ratings firms ever announce that their performance reports have been posted? Ours have, as they are every month, and the good news is ETF Global has consistently identified the best areas of the international equity markets. The bad news is our outperformance versus the S&P500 has come down. It really had nowhere else to go when our top Quant rankers more than doubled that benchmark on average last year. That was after five months when the model correctly called moves in Europe, China and other emerging markets. Quant turned its focus to the broad US market in December and has seen little movement from that stance since. Indeed, Quant’s top position today is held by the SPDR S&P 500 Fund (SPY), in 1st place for all but three days this month when it was in 2nd.
2013 has been a rocky year for most of the world equity markets so we are glad to have kept you on the US island in the storm. The two other funds that track the S&P 500 have also ranked well as have funds tracking the various Russell indices where Quant has done a good job of calling wiggles between the different market caps. Several of those funds outperformed the popular benchmark as did most of the smart beta funds that Quant has highlighted. Other selections aside from the broad US market also helped our numbers. You can follow the evolution of Quant’s message over the months by reading prior blog posts or check our Twitter feed, @ETF_Global, if you prfr msg < 140 char. We are not too proud to say it hasn’t all been so stellar. We knew we had a penance to pay for the high scores assigned to the Market Vectors Gold Miners Fund (GDX). You are probably not too happy if you bought it when it scored so well in February and we will have to live with it for a couple more months since Quant seemed to miscall a bottom again in late March. Think of it as a diversifier. It even earned the daily 10 Green Diamond distinction on several days but we will cover that model tomorrow.
On net, Quant’s top 10 ETFs as a group each day have outperformed the S&P500 by more than 46% on average for the next month. That covers all rolling periods since our July 2nd inception and not much has outperformed that benchmark in the last few months. The report, available on the publicly accessible part of our website, also includes wider groupings and longer periods that have beaten the index almost 70% of the time. We are looking forward to Quant’s next call but for now the model says to stay on that US island, 6 of today’s top 10 are US broad market funds.