Monday, June 17, 2013

Crossing onto this side of the Galactic Alignment last December 21st, ETF Globalsm announced a commitment to transparency in quantifying and reporting on the performance of our ratings.  Closing out the second half of the year in which we launched, our models had directed our users to the opportunities in Europe and emerging markets that few others had recommended.   When we said our recommendations could lead you to outperform the S&P 500 by a wide margin we did not know the shift  the market was about to take.  But by the time Santa was steering his sleigh clear of the fiscal cliff, Quant recognized the forthcoming shift. Our December 31st post was clear in recommending the US market that lifted off on this year’s first trading day and has led the world in 2013.  The model has been weighted towards US broad market funds all year with ETFs exposed to the S&P 500 and various Russell market cap segments dominating the ranks.

Outperforming that benchmark by a wide margin has become impossible when that is what we are recommending but despite spending almost half our existence in that posture, out top ranked funds continue to outperform.  We group them by Quant’s top 10, 25, 50 and 100 ranked equity ETFs each day, average their performance over the coming 1, 2 and 3 months, and compare to how the S&P 500 did in those same rolling periods.   The ETFGsm average has beaten the benchmark a majority of the time, albeit at a narrowing margin.  You can see each month’s performance update on the publicly available part of our website under the ETFG Quantsm button.

Today we see iShares funds tracking the large cap Russell 1000 Value index (IWD) and small cap Russell 2000 Growth index (IWO) in the top 10 maintaining that US broad market exposure but also some technology and energy sector funds.  Not many foreign funds are catching Quant’s attention but the Market Vectors Egypt Index Fund (EGPT) sees it first trip to the top 25 at 24th place today on a strong 85.1 Fundamental Score.  The correction in Japan has boosted the iShares MSCI Japan Index Fund (EWJ) up to 13th place driven by a solid 78.4 Behavioral Score.  We welcome the separation from the benchmark these products will provide  for our coming performance reports and in this new era of investing, we thank you for being part of ETF Globalsm.

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