Tuesday, January 8, 2013

That’s all right Notre Dame, you had a Cinderella season but it was good rocking last night for the University of Alabama, one of college football’s large cap names.  It feels so right that a number of US large cap basic materials funds are slipping into Quant’s blue suede shoes, two SPDR S&P kissing cousins lead the ranks today.

The 1st place SPDR S&P Metals and Mining Fund (XMEhasn't treated us too nicely since it was in these upper ranks in late October but the fund is finally showing positive performance since then.  It gets Quant’s top spot for the second day in a row on strong fundamentals and a high Sentiment Score reflecting market skepticism towards these economically sensitive industrial metals companies.  It is similar suspicious minds that get the SPDR S&P Oil & Gas Exploration & Production Fund (XOP) in 2nd place for the 2nd day in a row.  It gets an even better Sentiment Score but with lower Technical and Fundamental Scores.  Rounding out an American trilogy of large cap basic materials funds is today’s 4th place iShares Dow Jones U.S. Basic Materials Index Fund (IYM) again scoring well in the sentiment measures but with a better balance of Technical and Fundamental Scores in the low 70s.  The market may think these are hound dogs but Quant sees them as big hunks of love.

Quant’s small cap fever is cooling off a bit but we still see the upper ranks dominated by US funds.  Average risk remains on the low side exemplified by the SPDR Industrial Select Sector Fund (XLI) maintaining a top ten ranking in 5th place with a low Red Diamond Risk Rating of 2.55.  So Quant says America's beautiful large caps will bring peace to your valley and keep you out of the Heartbreak Hotel.  Congratulations to the Crimson Tide and happy birthday to the King of Rock & Roll, wherever you are.

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