Mutual Funds On The Cutline – Updated as of 7/18/2011 – More Improvements

Ulli Mutual Funds On The Cutline Contact

More downside momentum kicked in yesterday, as worries about the progress, or lack thereof, about the U.S. debt ceiling kept traders on edge. Supporting the sour mood were reports from Europe confirming utter confusion about the debt crisis with no clear leadership and/or plans emerging to attack the ever growing problems.

Just as last week, many funds have been meandering around the cutline with no obvious direction. The DrawDown figures (DD% column) leave a lot to be desired and are in many cases closer to triggering their trailing sell stop points than making new highs.

As I mentioned in yesterday’s ETF Cutline report, I am in the process of expanding the +20 listings to a range of up to +200. That will speed things up for you, if you are following specific funds, in that you will have all data in one place without having to resort to the weekly StatSheet.

Here’s this week’s mutual fund cutline report:

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ETFs On The Cutline – Updated through 7/15/2011 – Upcoming Improvements

Ulli ETFs on the Cutline Contact

With the S&P 500 having lost 2.1% during last week’s sell-off, most of the activity around the cutline was to the downside. Even High Yield Bonds (JNK) continued their roller coaster ride, as they now again slipped below the line to -10 from the previous +6 position.

Right now, there is simply no stability as far as upside momentum in the equity arena is concerned. The positive action has taken place with Precious Metals, Natural Resources and Health Care. However, volatility is quite high, and there are very few ETFs with low DrawDown numbers (DD% column).

You will be able to see these comparisons much better in the new and expanded Cutline report, which I hope to have completed by next week. Rather than being able to view only the first 20 ETFs above the cutline, you will have the choice to view the first 200 listings, if there are that many.

Take a look at this week’s report:

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Last Week In Review: ETF News And Blog Posts

Ulli ETF News Contact

In case you missed it, here’s a summary of the ETF topics that I posted to my blog during the week ending on 7/15/2011.

Continued global uncertainty, along with questionable economic data, made this past week a losing one for equity ETFs. On the positive side, the metals rallied strongly and helped elevate our core holding PRPFX.

My published Cutline tables and Model ETF Portfolios can give you an assist by indentifying weakness and strength in various market segments so that you can make better investment decisions by avoiding exposure in those areas that are trending down.

This week, we covered the following:

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How should ETFs be used by Retirees and Conservative Investors?

Ulli ETF News Contact

That’s an interesting question indeed, and Seeking Alpha tried to cover some ‘dos’ and ‘don’ts’ via “An ETF Primer for Retirees and Conservative Investors.”

Here are some highlights, but I suggest you read the entire article if that topic is of interest to you:

Over the past few years, exchange-traded funds have made a big impact on the 80-year-old mutual fund industry. But do these new products belong in conservative portfolios?

Some regulators and investors have warned about hidden risks in ETFs and the dangers of exotic investment options. While many of their concerns are valid, we think tarring the whole industry is throwing the baby out with the bath water. Not all ETFs have the same operational and investment risks. In fact, many ETFs are perfectly suitable for a retiree’s portfolio. They’re easy to spot, once you know what traits to look for: simplicity, low costs, and diversification. Here we provide quick tips on how to navigate through the muddied waters.

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ETF Leaders And Laggards – For The Week Ending 7/15/2011

Ulli ETF Leaders & Laggards Contact

Here is a quick ETF review of the past week’s winners and losers from my High Volume ETF Master list:

Equities got slapped around this past week with the S&P 500 giving back 2.1%. Shining brightly were gold related ETFs along with Natural Gas. As you can see, gold had a super week by adding +3.29% on top of the previous week’s advances.

While we own some GLD, we primarily participated indirectly in this rally via our exposure to PRPFX.

On the losing side of the equation was Spain, which go hit hard for the second week in a row. Same goes for the European Union, which is still stuck deep in debt issues that are far from being over, despite much jawboning to the contrary.

Not recognizable from the above tables is the fact that the international arena has sunk back into bear market territory, as I posted yesterday. To me, that means uncertainty will be our close companion again next week, so be sure to monitor your trailing sell stops closely.

Disclosure: Holdings in GLD

07-15-2011

Ulli Newsletter Archives Contact

ETF/No Load Fund Tracker StatSheet

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THE LINK TO OUR CURRENT ETF/MUTUAL FUND STATSHEET IS:

https://theetfbully.com/2011/07/weekly-statsheet-for-the-etfno-load-fund-tracker-updated-through-7142011/

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Market Commentary

Friday, July 15, 2011

AGAINST THE WIND

The major market ETFs simply faced too many headwinds and, as a result, the S&P 500 lost 2.1% for the week after two weeks of gains.

No matter where you looked, the news was predominantly negative as Europe’s worsening debt crisis set a sour mood last Monday and Tuesday. On Wednesday, confusion reigned as Fed chief Bernanke, the big flip flopper, left the markets guessing as to future stimulus.

The Disciplined Investor put it best:

After Bernanke’s latest testimony, we may want to consider him the latest King of Spin for this economy.  Bernanke has successfully been able to destroy the US Dollar all while keeping a “Strong Dollar Policy”. He has also flip flopped so much on key subjects such as monetary policy that we are not so sure what he has planned next. He has kept Wall Street on their toes that is for sure. Let’s look at his latest testimony to see what we are talking about:

Fed’s Bernanke says given uncertainties about recovery and inflation, Fed remains prepared to adjust stance of policy if appropriate.

then he says… Possibility remains that weakness more persistent than expected, deflation risks may return implying need for more monetary policy support

but then he states…Economy could evolve in a way that would warrant move to less accommodative policy.

So, which is it, accommodative or less accommodative?

Obviously, if the market is confused, it won’t go anywhere, which is exactly what happened on Thursday and Friday. More of a sell off was averted, despite a dismal consumer sentiment report, thanks in part due to Google’s blowout earnings.

Our Trend Tracking Indexes (TTIs) followed the ups and downs, but a least, for the time being, we got clarification in the international arena, as that index slipped back into bear market territory. Here are the numbers after today’s close:

Domestic TTI: +3.82% (last week +4.54%)
International TTI: -1.28% (last week +1.26%)

While the focus will be on earnings next week, the continued battle about the U.S. debt ceiling will very likely be part of the front page news stories. Throw in some unforeseen events from the European debt circus, and you’ll have a recipe for more uncertainty, which is bound to offer additional support for gold.

Should an agreement be reached in regards to the debt ceiling, look for a relief rally. However, it remains to be seen whether that will simply be a one-day wonder or, if it will morph into more than that. My guess at this time is that any rally will be of limited duration.

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 Richard:

Q: Ulli: I was fooling around on the Schwab website, and I found an option to “reinvest dividends” (yes/no), on my account holding detail page. They are all marked “no”. I don’t even know if ETF’s pay dividends; I never held one long enough. Anyway is “no” what you want?

A: Richard: Yes, for all of my clients, I have the “no re-investment” of dividends selected. Whenever you re-invest within a taxable account, this tiny amount becomes a new cost basis, which has to be accounted for at year end. That can be an accounting nightmare, even though Schwab provides the cost basis calculations.

 

My preference is to let the small amounts accumulate and, if market conditions are favorable, invest in a select ETF via a larger amount.

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https://theetfbully.com/personal-investment-management/

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Back issues of the ETF/No Load Fund Tracker are available on the web at:

https://theetfbully.com/newsletter-archives/