Wednesday, October 29, 2014

Fall 2014 ETP Forum - 11/19 - Speakers Announced

ETF Global was selected to facilitate the Fall 2014 ETP Trading & Investing Forum NYC on Wednesday, November 19th!  

The event once again looks to be terrific and will feature an all-star lineup of speakers which was announced this week. Please see below for the list of confirmed speakers.  We hope to see you there! 

For more information, please visit www.expertseries.org and here is a link to Add to Calendar

Confirmed Speakers:
Jeff Macke, Host of Breakout, Yahoo Finance
Josh Brown, CEO, Ritholz Wealth Management
Nick Cherney, CIO, Velocity Shares
Joe Anthony, President - Financial Services, GREGORY FCA
Mike Boucher, Portfolio Manager, Fidelity Investments
Larry Whistler, President & CIO, Nottingham Advisors
Thomas Mosel, Managing Director, Windhaven Investment Management
Justin Sibears, Quantitative Strategies Group, Newfound Research
Randy Bullard, ETF Solutions Group, Cantor Fitzgerald
Jason Lichten, Director of Equities and Listed Derivatives, Wolverine Execution Services
Robyn Misiano, Head Equity Trader, Boston Advisors
Steve Sachs, Head of Capital Markets, ProShare Advisors
Scott Dooley, CIO, Fusion Investment Management
Darshan Bhatt, Co-Founder/Deputy CIO, Glovista Investments
Morgan Harting, Senior Portfolio Manager, Alliance Bernstein
Phil Mackintosh,  KCG Holdings
Francis Rodilosso, Portfolio Manager, Van Eck Global
Matthew Kerfoot, Partner, Dechert LLP
Christian Hoffmann, Director, Liquid Alternatives, Credit Suisse Asset Management
Ethan Powell, Chief Product Strategist, Highland Capital management
Kim Flynn, SVP, Head of Product Development, Nuveen Asset Management
Mark Yusko, CEO & CIO, Morgan Creek Capital Management
Jerry Levy, Managing Director, Tricadia Capital Management
Bob Kricheff, Portfolio Manager, Shenkman Capital
Brian Good or Mike Herzig, Portfolio Manager, THL Credit
Ronnie Jaber, Portfolio Manager, Carlyle Group
Lee Shaiman, Senior Portfolio Manager, GSO
Frank Paone, Partner, Director of Institutional Investor Services, Lord Abbott
Edgar Sullivan, Ph.D., Senior Strategist, SECOR Asset Management
Paul Joss, Investment Strategist, Hartford Investment Management
David Abner, Head of Capital Markets, WisdomTree Asset Management
Rob Glownia, Quantitative Analyst, Riverfront Investment Group
Jay Fraser, Head of Business Development, IEX Group
Haddon Kirk, Head ETF Trader, UBS Securities
Chris Romano, Director of Research Applications, ETF Global

Thank you for reading ETFG Perspectives!

Monday, October 27, 2014

A look at recent Fund Flows.........

Having control of their currency helped lift Sweden and Switzerland above their EU counterparts and while this past week was true to that pattern, the strongest action was right here in the good old U.S. of A.  

For all those candlestick fans out there, after forming a hammer pattern when it hit its 50 week moving average, the S&P 500 confirmed the bullish trend and bounced higher last week to the tune of 4.12% and recovering more than half of the losses since the mid-September highs.  Bond investors have been given a warning with the while Vanguard Total Bond Market Index Fund (BND) showing it’s opposite pattern of a shooting star and possible indicating trouble ahead.  With the AAII Investors Intelligence survey already bouncing back to the old highs we have to ask whether the trend is for real and whether it’s too late to join in on the fun.

As the old saying goes, “investors like to vote with their feet” so let’s review the ETFG Global Fund summary to check out month-to-date fund flows.  The names of the biggest outflows for the month shouldn’t come as much surprise with broad market equity ETF’s showing heavy distribution as investors continue to remain cautious.  While the SPDR S&P 500ETF (SPY) pulled in nearly $1.9 billion for the most recent week, it remains in a $16.3 billion dollar hole for the trailing month while broad equity exposure fund flows for mid-cap names remains weak with a further $66 million leaving the iShares Core S&P Mid-Cap ETF (IJH) to take the trailing monthly drawdown to over $3 billion.

Where are equity inflows unabashedly positive and with the performance to prove it?  Traditional equity safe havens continue to dominate with REIT’s holding down the number one spot where the iShares Real Estate ETF (IYR) has pulled in over $1.5 billion and nearly increased assets by 50% in the last month and over surprisingly $700 million of that in the most recent week.  The Consumer Staples Select Sector SPDR Fund (XLP) tells a similar story with over $588 million in asset growth for the most recent week and $1.17 billion for the trailing month.  While it’s always tempting to go with the winning horse; the sector rotation for defensive to offensive names was so pronounced when the S&P 500 began moving higher in May there may be no safety in numbers.

While equity flows may have turned positive (or less negative as the case may be) have bond flows turned negative?  According to Lipper Insight, bond flows (mutual funds and ETF’s) recorded their fifth week of inflows and while the Vanguard Total Bond Market Index Fund (BND) may have been down .3% last week, positive inflows continued to the tune of $262 million to take the trailing monthly inflow to over $3 billion and there’s a similar story for iShares Core U.S. Aggregate Bond ETF (AGG).  For now investors seem to prefer the tried and true to going too far out on a limb, no matter what they tell an anonymous survey.

Thanks for reading ETFG Perspectives!

Monday, October 20, 2014

International Surprises

If we asked you what the first thing that comes to mind when we say “Sweden” what would it be?  We don’t think you would answer that it is number 5 on the ETFG Quant Ranking or just one in a litany of international ETF’s that turned in strong performances on Thursday and Friday following the global rout.

So far, 2014 won’t be remembered for how kindly it treated international equity markets.  The MSCI All-Cap World Index ex US (ACWX) is down over 5% compared to -.91% for it’s more inclusive brother, ACWI, while you could almost hear the cheers of “USA, USA!” when both the S&P 500 and PowerShares DB US Dollar Index Bullish Fund (UUP) enjoyed a strong August while the iShares MSCI EAFE ETF (EFA) treaded water.  The cause?  A clear lack of coordination in response to their mutual affliction of deflation and weak economic output has kept the members of the Eurozone from enjoying the sort of economic recovery that we’ve had in the land of the free and any nation within the Eurozone or with a currency pegged to the Euro has lagged.

You can get proof of this theory by going to the ETFG Behavioral 25 and reviewing the long list of emerging market ETF’s that make up seven of the names on the list.  A strongly appreciating U.S. dollar will clearly help these nations manage their balance-of-payments issues and spark some sort of economic growth, but the bigger boost comes from controlling their own monetary policy.  Instead of trying to coordinate policy among 28 different finance ministers; Turkey, Brazil and South Africa (all well represented on this list) get to make their respective policy decisions.  No wonder the iShares MSCI Sweden ETF (EWD) is number 5 on the ETFG Quant Screener and the iShares MSCI Switzerland Capped ETF (EWL) is at number 8.  We’ll leave it up to you to see how far down the list you have to go before you find a country that uses the Euro.
 
And what helped make EWD one of the behavioral darlings with its ETFG Behavioral Quant score rising nearly 50% in one week?  While its performance relative to a broader European oriented ETF such as the Vanguard European Vipers ETF (VGK) has been better since the dollar began its strong move on July 1st, (EWD is down 11.99% while VGK is off over 13% through Friday), lack of exposure to the Euro can’t be the whole of the story.  While deflation and the potential for monetary easing are a clear and present danger to Sweden, the real story has to be EWD pulling back to long-term support at the $31 mark established in early 2013, or becoming oversold on a weekly basis while running into the 150 week moving average.  In other words, there might be more to the Swedish success story than lack of Euro exposure.

Thank you for reading ETFG Perspectives!

Monday, October 13, 2014

Changing Tenor

Like Columbus, if anyone out there had been fortunate enough to take the month of September to sail the world, imagine their reaction when they checked the market.  From the S&P 500 setting new highs in late August to being within spitting distance of its 200 day moving average after having broken the 2012/2013 uptrend pattern in just five weeks - the tenor of the market has changed dramatically.  But even in these times, a few sectors have managed to stand out as the large cap indices begin to feel the pain inflicted on their small and mid-cap brethren.

We may only be eight trading days into October, but a full swing back into the defensive sectors that dominated the first quarter has begun.  Since October 1st through the 10th, the Utilities Select Sector SPDR Fund (XLU) is up over 2% while Consumer Staples Select Sector SPDR Fund (XLP) is up 1.1% compared to the S&P 500 off 3.35% in the fourth quarter.  If you re-sort ETFG Quant on the latest technical scores, 9 of the 10 ETF’s on the list are classified as either consumer staples or utilities.

Before you get your buy orders ready, remember that improving momentum doesn’t necessarily mean positive performance, just better than their recent history.  Utilities continue to be putting the most points on the board with the Deutsche X-trackers Regulated Utilities ETF (UTLT) up 2.76%, thus far in the fourth quarter with its overall behavioral score going from 48.09 on October 8th to 63.37 on October 10th.

But if you prefer to keep things simple and see ETFs as an asset class, head over to Indices and review the ETFG Global Consumer Discretionary Index which managed a positive .32% on Friday compared to -1.14% for the S&P 500 while the ETFG Global Utilities Index did even better with a positive .43% to bring it to a 12.32% return YTD.  If you are curious as to how the Global Consumer Staples Index differs from Consumer Discretionary, note that it has a larger base of ETFs to draw from both offering more specialized domestic exposure (home builder stocks for example) and internationally, for example the Global X China Consumer ETF (CHIQ) that can act as a drag when domestic equities are clearly king.
With Asian equities heading lower and dragging S&P futures with it.  If nothing else, this week should be interesting.

Thank you for reading ETFG Perspectives!

Wednesday, October 8, 2014

And in the 4Q we are!

With 4Q 2014 off to an exciting start, it’s worth remembering that rarely do new trends or sectors emerge as winners this late in the year.  Rather, this is the time for harvesting and letting winners run until December when profits are booked and cash is freed up for the upcoming year.  After a wild summer ride with new record highs, the S&P 500 gave up ground to end up 2.53% while the MSCI ACWI index lost .48%.  So who actually has profits to harvest and who’s going to be calling Uncle Sam to try and cash in on crop insurance?

Let’s start by looking at our Behavioral 25 where eight of twenty five names are from the health care sector.  Biotechnology names continue to dominate the list and none too surprising since the iShares Biotechnology ETF (IBB) was up 14.41% in the third quarter compared to 7.67% for XLV and 2.53% for the S&P 500 while it’s SPDR sister, XBI, was up over 18.7%!  Both of the biotech ETF’s scored highly on technical scores but Sentiment scores were the difference as XBI was at the upper end of its historic put/call ratio and IBB ranked much higher on short interest.  The difference was also in the volume; take a look at the ETFG Tearsheets and you’ll see that IBB has nearly 5x the volume of XBI making it the fund of choice for short positions.

And what about those Portfolio Managers out there with a discretionary mandate and who need to make up performance?  While this quarter may be a lost cause, it’s never too late to start thinking about next year and using our ETFG Quant Screener.  

Which ETF’s score highest on the Sentiment scores while momentum couldn’t get much worse? And why for the love of heaven would you ever want to put money to work in these funds?  Because not only do they offer a combination of high short interest and momentum that couldn’t (in theory) get much lower, they have high implied volatility meaning if they do advance, a short covering rally might push them even higher.

After resorting the list on Sentiment scores and looking for weak momentum names, miners and precious metals take up the top spots with the Market Vectors Junior Gold Miners ETF (GDXJ) in the second slot and the iShares MSCI Global Gold Miners ETF (RING) at number 20.   High Risk = High Reward…eventually.

Thank you for reading ETFG Perspectives!

Monday, October 6, 2014

ETFG Weekly Select List - 10/6/14

Each Monday, the ETFG Select List features the 5 most highly-rated equity ETFs by Sector, Geographic Region and Strategy as ranked by the ETFG Quant model.  Below please find the Top 5 ETFs that comprise the highest group average by Sector, Geography and Strategy – this week's complete list is here:  ETFG Select List - October 6, 2014

SECTOR:  This week’s top rated group score is the Industrials Sector

Sector:  Industrials                                 Group Average:  62.78
Rank
Ticker
Focus
Region
TER
Risk
Reward
Quant
1
XLI
Industrials
North America
0.16%
2.49
8.67
64.50
2
ITA
Industrials
North America
0.44%
3.97
8.72
64.00
3
XAR
Industrials
North America
0.35%
4.32
8.48
63.30
4
PPA
Industrials
North America
0.66%
3.01
8.63
62.30
5
CHII
Industrials
Asia-Pacific
0.65%
4.16
8.87
59.80

GEOGRAPHY: Interestingly, the Geographic top rated group remains the Asia-Pacific Region and perhaps here is where uncertainty may in part provide opportunity.

Geography:  Asia-Pacific             Group Average:  63.66
Rank
Ticker
Region
Focus
TER
Risk
Reward
Quant
1
EWY
Asia-Pacific
Broad Equity
0.61%
4.13
9.23
64.90
2
DXJS
Asia-Pacific
Broad Equity
0.58%
4.06
9.19
64.50
3
FXI
Asia-Pacific
Large Cap
0.74%
4.81
9.29
63.30
4
PGJ
Asia-Pacific
Broad Equity
0.70%
5.78
9.90
63.00
5
TCHI
Asia-Pacific
Broad Equity
1.00%
7.69
9.69
62.60

STRATEGY:  The Strategy top rated group transitioned this week Large Cap.

Strategy:  Large Cap                        Group Average:  63.78
Rank
Ticker
Focus
Region
TER
Risk
Reward
Quant
1
ADRE
Large Cap
Emerging Markets
0.30%
5.42
10.00
67.60
2
FXI
Large Cap
Asia-Pacific
0.74%
4.81
9.29
63.30
3
OEF
Large Cap
North America
0.20%
2.99
8.81
62.90
4
VOO
Large Cap
North America
0.05%
3.10
8.79
62.90
5
FNDX
Large Cap
North America
0.32%
1.67
8.87
62.20

This ETFG Select List is meant to be a quick reference guide and not to replace checking the daily ETFG Quant Rankings, Green Diamond Reward Ratings and Red Diamond Risk Ratings.  To best support the ETF selection process, ETF Global strongly encourages users to perform a more comprehensive review by utilizing the ETFG Scanner and additional tools and resources available at www.etfg.com to further research and diligence exchange-traded-funds.

Thank you for reading ETFG Perspectives!