Friday, July 12, 2013

The latest Green Diamond Reward Ratings performance report has been posted under the Analytics button and like their close cousin Quant, they have consistently identified the best parts of the international equity markets for the intermediate term.  The Diamond models break out the risk metrics from Quant so there are some differences.  Each day, one equity ETF gets the 10 Green Diamond Reward Rating identifying it as the fund with the best prospects for price appreciation; today it is the SPDR S&P China Fund (GXC). 

We also group all the 9, 8, and 7 Green Diamond funds each day, average their performance over the coming 1, 2 and 3 months and compare to the S&P 500.  You can see that the 10s usually beat the 9s which beat the 8s which beat the 7s.  Like Quant, these numbers got skewed by the washout in the gold miners fund, GDX, after it spent most of February with 9 or 10 Green Diamonds.  We hope you used stops if you bought it then although the performance data does not use such modifiers.  Since then, the model has favored the PowerShares Dynamic OTC Portfolio Fund (PWO) more than any other and it has performed splendidly.  Looking at all the days from last July through this June, our first full year produced 2,471 datasets where the ETFG® groups beat the S&P 500 more than 55% of the time.  The SPDR S&P 500 Fund (SPY) was in those groups for all but one day with other US broad market funds dominating the ranks for much of 2013.

Today’s selection of GXC reminds us of last fall when that fund dominated the ratings and provided excellent outperformance.  Its rating quickly deteriorated in early January and it dropped below 7 Green Diamonds on January 18th, the day before it peaked before suffering a 20% correction which bottomed on June 24th.  Having spent most of 2013 at 6 or 7 Green Diamonds, it got back up to 8 a couple of days before that bottom, broke 9 on July 9th and is back to 10 today.  If you want to see all the funds in order of their Green Diamond Reward Ratings you can sort the Reward column in our Scanner.  Today that returns 150 equity ETFs rated 7 or higher which has proven to be an excellent selection list out of the 722 getting scored.  If you have any questions, please send them to  Thanks for reading and have a nice weekend.

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