Thursday, March 14, 2013

The bells toll and Pope Francis says all you need is love.  At ETFGsm we love supporting your ETF investment decisions and with Quant helping us learn how to play the game it’s easy, at least when you are in a market melt up. Quant is still shining its love on the leading broad US market with the top 19 funds all being US based, except for a tiny sliver of today’s 2nd place Market Vectors Gold Miners Fund (GDX).  Yes like Francis, Quant saves some of its love for the downtrodden.  Looking at the  top 25 ranks today we see 5 iShares Russell funds covering the market cap spectrum (IWO, IWB, IWM, IWD, IWV), the 3 funds tracking the S&P 500 (SPY, IVV, VOO), another tracking the midcap 400 (MDY), Vanguard’s Value, Growth and Smallcap Growth funds (VTV, VUG, VBK) and the iShares MSCI USA Minimum Volatility Index Fund (USMV).  That’s a clear expression of Quant’s current love for the broad US market.

There’s nothing you can know that isn’t known and nothing you can see that isn’t shown but quantitative analysis cuts though the noise and our personal emotions to help us find the hidden gems among all the choices.  Outperforming those broad market funds is not so easy but the model has also highlighted some sectors and regions for us. In addition to those gold miners, Quant’s love for the 4th place SPDR S&P Oil & Gas Exploration & Production Fund (XOP) is unshaken and has spilled over to the iShares Dow Jones U.S. Oil & Gas Exploration & Production Index Fund (IEO) rising 74 positions into 13th place this morning.  The 10th place SPDR Industrial Select Sector Fund (XLI) also remains in Quant’s good graces and the iShares Dow Jones U.S. Technology Index Fund (IYW) has worked its way back up to 25th place today. Two other countries make the top 25 with iShares’ MSCI France and Canada Index Funds (EWQ, EWC) in 20th and 21st place.

It may be easy when the market hits new highs every day but the past nine months have not been so linear.  Newer users of ETFGsm might think our models are weighted towards the broad US market as 2013 has seen little movement overall in the elite rankings.  Our charter members who came on last summer remember those top ranks being populated by European funds which were gradually replaced with emerging market funds in the fall.  Quant’s current love affair with America emerged when the fiscal cliff fears were driving our market into the slums late last year.  Any advisor or manager knows it’s not easy to spot those market shifts and like that Jewish carpenter who Francis devoted himself to, you need tools.  ETF Global has developed those tools to keep your portfolios straight and on the level and we thank you for helping us spread the word.  We wish Pope Francis Godspeed as he begins his “journey of brotherhood in love”.   

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