ETF/No Load Fund Tracker StatSheet
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THE LINK TO OUR CURRENT ETF/MUTUAL FUND STATSHEET IS:
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Market Commentary
Friday, September 9, 2011
ANOTHER ETF ROLLER COASTER RIDE
Equity ETFs were handed a sharp loss today amid rumors that Greek might default over the weekend (no surprise here) and that an ECB high level official resigned among rumors of disagreement in regards to the central’s banks decision to buy bonds of over indebted Euro zone countries.
Not helping matters were reports that Germany was preparing to throw an assist to its banks should the next installment of Greece’s bailout be denied, and the country defaults.
It was uncertainty at its finest, and the equity market closed down sharply. The dollar strengthened, bonds rallied and gold closed up, but only slightly. That came as a surprise to me, as I would have expected gold to rally strongly. Maybe that will be the case, once the rumored default actually occurs.
Overshadowed by the major events was Obama’s plan to create jobs. There was nothing chest pounding about the plan itself, but if the subject interests you, consider reading Mish Shedlock’s opinionated piece on the topic.
Our Trend Tracking Indexes (TTIs) dropped with the market and are showing the following positions in regards to their respective long-term trend lines:
Domestic TTI: +0.71% (last week +1.35%)
International TTI: -12.03% (last week -9.42%)
Please note that the Domestic TTI still hovers above its trend line, but we have been in ‘Sell’ mode since 8/9/11. In case you missed it, this indicator has been dancing around the trend line for a month now without giving us any clear indication as to the major trend. That’s why I have held off issuing a new ‘Buy’ in order to avoid a possible whip-saw signal.
If more bad news surface out of Europe over the weekend, the downside will come into play even more, and we may subsequently see the Domestic TTI move back to the bearish side. If it stays there, I will consider putting on the PRPFX hedge again.
Yes, with the benefit of hindsight, I should have held on to the recently liquidated hedge. It just goes to show how difficult the markets currently are, and that minor trends in both directions have the bulls and bears engaged in a yet to be decided tug-of-war.
Have a great week.
Ulli…
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READER Q & A FOR THE WEEK
All Reader Q & A’s are listed at our web site!
Check it out at:
http://www.successful-investment.com/q&a.php
A note from reader George:
Q: Ulli: Was curious why you didn’t apply SH hedge to Portfolio 7 ETF version of Permanent Portfolio whereas you did for portfolio #1 based on PRPFX? Or did I misunderstand?
A: George: The reason was simply that we have a different view of how portfolios hold up. I did hedge a couple of my ETF equivalent portfolios in my advisor practice, but most of them were with PRPFX.
As I said before, #7 tends to hold up much better in down markets.
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Back issues of the ETF/No Load Fund Tracker are available on the web at:
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Contact Ulli
Comments 4
You said gold closed up, but only slightly. According to Yahoo! Finance, the golf ETF GLD closed down 1.11 (-0.61%). Am I missing something?
Thx.
Lew
Lew,
While the spot price for gold closed up by $4, the Gold ETFs did not.
Ulli…
Ulli,
I have followed your blog for years. I am disappointed that you would link to such an extremely biased analysis as the one by Mish Shedlock. I couldn’t continue reading it because it is obvious at the outset there is no objectivity. I dismiss analyses that are from a person who clearly begins with an agenda.
This is all I read:
“Mish: That is lie #1. There shouldn’t be anything controversial about the proposal, but there is. Obama’s proposal is primarily an election stunt as opposed to a genuine effort to produce jobs.”
I’m inclined to think our president is interested in doing what’s right for the nation, even if I disagree with what he does. I think this Mish jerk has no reasons or evidence to support accusations that the plan is an election stunt. It sounds like ranting and pejorative criticism.
I would like to know truthfully the problems with Obama’s proposal and how Republicans and Democrats might agree on something that would benefit our economy. I am annoyed by extremely opinionated people who let their bias interfere with their judgment. Especially people who do not have the common courtesy of refraining from calling the President a liar. I would punch this guy in the face if I met him.
Jim Mears
Jim,
While I disagree with you, you are entitled to your opinion, which is why I have it published.
Ulli…