Monday, September 16, 2019

Strong September Push Continues

Monday, September 16, 2019 – A continued easing in US-China trade tensions, strong consumer spending and dovish global central bank policies helped power stocks to a third consecutive week of gains and back into record territory. The major indexes now sit within 1% of their all-time highs registered in July, after the DJIA, S&P 500, and Nasdaq rose 1.6%, 1%, and 0.9% this week.

Following a tumultuous August, where stocks were beset by wild swings in response to the escalation of trade tensions, some measure of calm has returned to the markets with the US and China each taking steps to moderate their differences. The trade outlook brightened after China announced that it would exempt certain US products for tariffs scheduled for September 17th and encourage Chinese companies to purchase US agricultural goods. On the heels of this positive development, the US took a reciprocal goodwill gesture by postponing a 5% increase on $250 billion of Chinese goods from October 1st to October 15th, so as to not conflict with the 70th anniversary celebration of the People's Republic of China.

Improving trade tensions coincided with a stream of encouraging economic data with U.S retail sales rising 0.4% in August, consumer sentiment rebounding from its August tumble, and jobless claims remaining at historically low levels.

Accommodative actions taken by the ECB provided further market support, as the central bank announced it would cut its key deposit rate and resume is monthly bond purchasing program. This supportive backdrop helped drive a rotation in market leadership with outperformance from small-caps and value-oriented sectors and a surge in treasury yields. Taken together, these developments help mitigate any immediate fears of a recession. However, absent a definitive resolution, the vicissitudes of trade tensions will continue to weigh on global economic growth and longevity of the current bull market.

ETFG Quant Movers – Those ETFs who have had the largest weekly change in their respective, overall ETFG Quant ratings.

ETFG Quant Winners: This week's top quant gainers reflects the moderating trade environment and rotation into small caps and value strategies. From 1-5, the funds with the biggest score increases were JPMorgan Event Driven ETF (JPED), WBI Power Factor High Dividend ETF (WBIY), USAA MSCI USA Small Cap Value Momentum Blend Index ETF (USVM), Validea Market Legends ETF (VALX), and ProShares Russell 2000 Dividend Growers ETF (SMDV).

ETFG Quant Losers: Our top quant losers reflects the other end of this week's market rotation, as safe haven assets suffered from easing trade tensions and rising treasury yields. The funds with the largest score decreases were Sprott Gold Miners ETF (SGDM), Invesco FTSE RAFI Developed Markets ex-U.S. Small-Mid ETF (PDN), iShares MSCI Emerging Markets Asia ETF (EEMA), Invesco Preferred ETF (PGX), and iShares Global Materials ETF (MXI).

ETFG Weekly Select List - The five most highly rated ETFs per Sector, Geographic Region and Strategy as ranked by the ETFG Quant model.

With small caps returning to favor this week, we'd like to bring attention to the leaders in this group according to our model. SPDR S&P 600 Small CapValue ETF (SLYV) currently sits atop our rankings, followed by SPDR S&P 600 Small Cap ETF (SLY), Invesco S&P SmallCap 600 Pure Value ETF (RZV), SPDR S&P 600 Small Cap Growth ETF (SLYG), and WisdomTree U.S. SmallCap Dividend Fund (DES). Small caps could be poised for a continued rally if the growth outlook remains stable. Our select list can be used as a guide to identify attractive plays within this group.

Thank you for reading ETF Global Perspectives!

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Assumptions, opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice.  ETF Global LLC (“ETFG”) and its affiliates and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively ETFG Parties) do not guarantee the accuracy, completeness, adequacy or timeliness of any information, including ratings and rankings and are not responsible for errors and omissions or for the results obtained from the use of such information and ETFG Parties shall have no liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of such information. ETFG PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO ANY WARRANTIES OF MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE.  In no event shall ETFG Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs) in connection with any use of the information contained in this document even if advised of the possibility of such damages.

ETFG ratings and rankings are statements of opinion as of the date they are expressed and not statements of fact or recommendations to purchase, hold, or sell any securities or to make any investment decisions. ETFG ratings and rankings should not be relied on when making any investment or other business decision.  ETFG’s opinions and analyses do not address the suitability of any security.  ETFG does not act as a fiduciary or an investment advisor.  While ETFG has obtained information from sources they believe to be reliable, ETFG does not perform an audit or undertake any duty of due diligence or independent verification of any information it receives.

This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  Any opinions expressed herein are given in good faith, are subject to change without notice, and are only correct as of the stated date of their issue.  Prices, values, or income from any securities or investments mentioned in this report may fall against the interests of the investor and the investor may get back less than the amount invested.  Where an investment is described as being likely to yield income, please note that the amount of income that the investor will receive from such an investment may fluctuate.  Where an investment or security is denominated in a different currency to the investor's currency of reference, changes in rates of exchange may have an adverse effect on the value, price or income of or from that investment to the investor

Wednesday, September 11, 2019

Monday, September 9, 2019

Short Week, Active Mix

Monday, September 9, 2019 – A resumption of US-China trade talks and a positive, yet slowing, pace of hiring revealed in Friday's August jobs report helped propel stocks to a second consecutive week of gains. In a holiday-shortened week, the DJIA, S&P 500, and Nasdaq rose 1.5%, 1.8%, and 1.8% respectively.

Investors continued to navigate a tenuous and divergent array of economic signals, with the announcement of high level US-China discussions in October and the ostensible relaxation in trade tensions proving to wield the largest influence on market sentiment. Receding geopolitical risks, including the formation of a stable Italian governing coalition and bleaker prospect of a hard-Brexit, helped further lift animal spirits. Domestic economic data releases showed that, while hiring slowed, wage growth is positive, unemployment remains near a record low, productivity is growing and the services sector is expanding. Furthermore, while largely positive, the picture painted by this week's data releases did little to alter expectation for Fed rate cuts, adding further support to equities. Favorable domestic data was augmented by dovish global central bank actions, with the PBOC's reduction of bank reserve requirement and the loosening of Russian central bank policy.

Despite this series of encouraging developments, other signs pointed to the downward impact of global trade tensions. Tuesday's ISM manufacturing index showed that US manufacturing activity contracted to a 3 year low. This added to the increasingly gloomy global manufacturing outlook, in which countries such as Japan, South Korea, and the U.K. have all recently reported slowing activity, weighed down by the sharpening of global trade hostilities. This sort of data lays bare the increasingly fraught nature of the current market environment, in which the longer trade tensions remain unresolved and this cloud of uncertainty looms, the more economic decision making and global growth will be constrained.

ETFG Quant Movers – Those ETFs who have had the largest weekly change in their respective, overall ETFG Quant ratings.

ETFG Quant Winners: The top funds registering the largest gains in their Quant Total Score were Global X Scientific Beta Asia ex-Japan ETF (SCIX), Global X MSCI China Financials ETF (CHIX), First Trust Indxx Global Natural Resources Income ETF (FTRI), ProShares MSCI Europe Dividend Growers ETF (EUDV), and Invesco Global Revenue ETF (RGLB). The global orientation of these funds shows the boost provided by this week's de-escalation in trade tensions.

ETFG Quant Losers: The funds suffering the largest declines in their Quant Total Score were Ivy Focused Value NextShares (IVFVC), iShares Core MSCI EAFE ETF (IEFA), Invesco S&P 500 High Beta ETF (SPHB), First Trust Developed Markets ex-US AlphaDEX Fund, and SPDR S&P Telecom ETF (XTL). An assortment of reasons contributed to these funds declines, including unfavorable idiosyncratic factor approaches, sector exposures, or geographic orientations.

ETFG Weekly Select List - The five most highly rated ETFs per Sector, Geographic Region and Strategy as ranked by the ETFG Quant model.

Given their sensitivity to global trade and manufacturing activity, we'd like to focus on the 5 most highlighted rated funds within the Basic Materials and Industrials sectors. In Basic Materials, our model currently ranks Global X Gold Explorers ETF (GOEX), U.S. Global GO GOLD and Precious Metal Miners ETF (GOAU), SPDR S&P Metals & Mining ETF (XME), iShares MSCI Global Silver Miners ETF (SLVP), and Sprott Gold Miners ETF (SGDM) as the 5 most promising funds. Within Industrials, First Trust NASDAQ Global Auto Index Fund (CARZ), First Trust Global Engineering and Construction ETF (FLM), SPDR S&P Kensho Smart Mobility ETF (HAIL), John Hancock Multifactor Industrials ETF (JHMI), and First Trust Nasdaq Transportation ETF (FTXR) rank as the highest funds according to our model. Amid heightened, trade-induced volatility, it is imperative to be particularly discerning when considering investments in these sectors. Our Select List can serve as a guide to navigate these choppy waters and unlock hidden upside.

Thank you for reading ETF Global Perspectives!

ETFG 21 Day Free Trial:  https://www.etfg.com/signup/quick

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Assumptions, opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice.  ETF Global LLC (“ETFG”) and its affiliates and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively ETFG Parties) do not guarantee the accuracy, completeness, adequacy or timeliness of any information, including ratings and rankings and are not responsible for errors and omissions or for the results obtained from the use of such information and ETFG Parties shall have no liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of such information. ETFG PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO ANY WARRANTIES OF MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE.  In no event shall ETFG Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs) in connection with any use of the information contained in this document even if advised of the possibility of such damages.

ETFG ratings and rankings are statements of opinion as of the date they are expressed and not statements of fact or recommendations to purchase, hold, or sell any securities or to make any investment decisions. ETFG ratings and rankings should not be relied on when making any investment or other business decision.  ETFG’s opinions and analyses do not address the suitability of any security.  ETFG does not act as a fiduciary or an investment advisor.  While ETFG has obtained information from sources they believe to be reliable, ETFG does not perform an audit or undertake any duty of due diligence or independent verification of any information it receives.

This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  Any opinions expressed herein are given in good faith, are subject to change without notice, and are only correct as of the stated date of their issue.  Prices, values, or income from any securities or investments mentioned in this report may fall against the interests of the investor and the investor may get back less than the amount invested.  Where an investment is described as being likely to yield income, please note that the amount of income that the investor will receive from such an investment may fluctuate.  Where an investment or security is denominated in a different currency to the investor's currency of reference, changes in rates of exchange may have an adverse effect on the value, price or income of or from that investment to the investor

Thursday, September 5, 2019

Registration Now Open - Fall 2019 ETP Forum - November 21 at the NYAC

Thursday, September 5, 2019 - ETF Global will again Chair the upcoming Fall 2019 ETP Forum on Thursday, November 21st at The New York Athletic Club and Registration is now open!

Now in its 7th year, this one-day symposium convenes some of the most widely recognized experts in Exchange-Traded-Funds and the brightest minds in Capital Management.  The ETP Forum features renowned speakers addressing cutting-edge topics within a vibrant and intimate learning atmosphere.

Agenda topics will include:

  • New-to-Market ETF Roundtable
  • ETF Best Execution
  • Thematic Investing, Social Impact and ESG
  • Fixed Income and Yield for Today’s Environment
  • Differentiating Among Smart Beta Strategies
  • Around the Globe: Best Opportunities for 2019 & 2020
  • The ETF Legal and Compliance Changing Landscape


**Please contact your ETF Global representative to inquire about complimentary passes to this event.

We look forward to seeing you there and thank you for reading ETF Global Perspectives!

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Assumptions, opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice.  ETF Global LLC (“ETFG”) and its affiliates and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively ETFG Parties) do not guarantee the accuracy, completeness, adequacy or timeliness of any information, including ratings and rankings and are not responsible for errors and omissions or for the results obtained from the use of such information and ETFG Parties shall have no liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of such information. ETFG PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO ANY WARRANTIES OF MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE.  In no event shall ETFG Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs) in connection with any use of the information contained in this document even if advised of the possibility of such damages.

ETFG ratings and rankings are statements of opinion as of the date they are expressed and not statements of fact or recommendations to purchase, hold, or sell any securities or to make any investment decisions. ETFG ratings and rankings should not be relied on when making any investment or other business decision.  ETFG’s opinions and analyses do not address the suitability of any security.  ETFG does not act as a fiduciary or an investment advisor.  While ETFG has obtained information from sources they believe to be reliable, ETFG does not perform an audit or undertake any duty of due diligence or independent verification of any information it receives.

This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  Any opinions expressed herein are given in good faith, are subject to change without notice, and are only correct as of the stated date of their issue.  Prices, values, or income from any securities or investments mentioned in this report may fall against the interests of the investor and the investor may get back less than the amount invested.  Where an investment is described as being likely to yield income, please note that the amount of income that the investor will receive from such an investment may fluctuate.  Where an investment or security is denominated in a different currency to the investor's currency of reference, changes in rates of exchange may have an adverse effect on the value, price or income of or from that investment to the investor.

Tuesday, September 3, 2019

Back To School...

Tuesday, September 3, 2019 – August 2019 was a month full of volatility during which stocks swung widely on frequent trade news, bouncing between progress on negotiations and the escalation of tariffs. However, stocks enjoyed their best week in nearly three months, as investors appeared to grow more confident in the prospects for a U.S.-China trade deal. Economic data also helped after showing that consumer spending rose by 4.7% in the second quarter, reflecting a strong gain.

Trading volumes started off low early in the week but picked up somewhat as institutional investors sought to rebalance portfolios before the end of the month. The major averages finished little changed, taking a breather following a wild month of trading. The Dow Jones Industrial Average closed up 41 points at 26,403. The S&P 500 ended the day just above the flatline at 2,926 while the Nasdaq Composite slipped approximately 0.1% to 7,962. Within the S&P 500 Index, Industrials outperformed, helped by a rise in UPS (UPS) shares. Health care, Consumer Staples, Real Estate, and the Utilities sectors lagged.

In ETF news, it seemed investors loaded up on traditionally safer assets such as gold and silver this month. Also, this week’s top inflows list was dominated by Treasury ETFs such as iShares U.S. Treasury Bond ETF (GOVT) and the iShares 20+ Year Treasury Bond ETF (TLT) each had a net inflow of over $380 million. However, the No. 1 position belonged to the SPDR Gold Trust (GLD), with inflows of over $1.2 billion. More notably, (GLD) rose 8% in August while the iShares Silver Trust (SLV) surged well over 12% for the month.

ETFG Quant Movers – Those ETFs who have had the largest weekly change in their respective, overall ETFG Quant ratings.

ETFG Quant Winners: The top five gainers in Quant Total Score were The Organics ETF (ORG), First Trust Australia AlphaDEX Fund (FAUS), iShares MSCI Chile ETF (ECH), ETRACS Alerian MLP Index ETN Series B (AMUB) and Knowledge Leaders Developed World ETF (KLDW) respectively. Each ETP added well over 10% to their score as behavioral scores and global factors came into play.

ETFG Quant Losers: Honorable mentions in the loser category were Forensic Accounting Long-Short ETF (FLAG), SPDR S&P Kensho Future Security ETF (FITE), USAA MSCI USA Small Cap Value Momentum Blend Index ETF (USVM), X-trackers MSCI EAFE Hedged Equity Fund (DBEF) and Invesco S&P MidCap 400 Revenue ETF (RWK). The reasons for the drop in quant score can be traced to fundamental and behavioral factors.

ETFG Weekly Select List - The five most highly rated ETFs per Sector, Geographic Region and Strategy as ranked by the ETFG Quant model.

Considering the sector’s success, we’d like to highlight the top ETFs within the Industrials sector in this week’s Select List. First Trust NASDAQ Global Auto Index Fund (CARZ) held onto the 1st place position followed by First Trust Global Engineering and Construction ETF (FLM) in 2nd and John Hancock Multifactor Industrials ETF (JHMI) in 3rd. iShares Transportation Average ETF (IYT) jumped from 5th to 4th and Fidelity MSCI Industrials Index ETF (FIDU), a newcomer to the list, claimed 5th.

Thanks for reading ETF Global Perspectives!

ETFG 21 Day Free Trial:  https://www.etfg.com/signup/quick

______________________________________________________
Assumptions, opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice.  ETF Global LLC (“ETFG”) and its affiliates and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively ETFG Parties) do not guarantee the accuracy, completeness, adequacy or timeliness of any information, including ratings and rankings and are not responsible for errors and omissions or for the results obtained from the use of such information and ETFG Parties shall have no liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of such information. ETFG PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO ANY WARRANTIES OF MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE.  In no event shall ETFG Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs) in connection with any use of the information contained in this document even if advised of the possibility of such damages.

ETFG ratings and rankings are statements of opinion as of the date they are expressed and not statements of fact or recommendations to purchase, hold, or sell any securities or to make any investment decisions. ETFG ratings and rankings should not be relied on when making any investment or other business decision.  ETFG’s opinions and analyses do not address the suitability of any security.  ETFG does not act as a fiduciary or an investment advisor.  While ETFG has obtained information from sources they believe to be reliable, ETFG does not perform an audit or undertake any duty of due diligence or independent verification of any information it receives.

This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  Any opinions expressed herein are given in good faith, are subject to change without notice, and are only correct as of the stated date of their issue.  Prices, values, or income from any securities or investments mentioned in this report may fall against the interests of the investor and the investor may get back less than the amount invested.  Where an investment is described as being likely to yield income, please note that the amount of income that the investor will receive from such an investment may fluctuate.  Where an investment or security is denominated in a different currency to the investor's currency of reference, changes in rates of exchange may have an adverse effect on the value, price or income of or from that investment to the investor