Ulli... The ETF Bully

ETFs/Mutual Funds On The Cutline – Updated Through 4/12/2013

Ulli Monday, 15 April 2013, 6:05 AM ETFs on the Cutline Contact

Below are the latest ETF Cutline reports, which show how far above or below their respective long-term trend lines (39 week SMA) my currently tracked ETFs/MFs are positioned.

The first report covers the ETF Master List from Thursday’s StatSheet and includes 398 ETFs, of which currently 346 (last week 338) of them are hovering in bullish territory.

The second report includes only High Volume ETFs. To clarify, High Volume (HV) ETFs are defined as those with an average daily volume of $10 million or higher.

These ETFs are generated from my selected list of some 93 that I use in my advisor practice. It cuts out the “noise,” which simply means it eliminates those ETFs that I would never buy because of their volume limitations. 72 ETFs (last week 66) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 815 (last week 799) above the line and 44 below it out of the 859 that I follow.

Take a look:

1. ETF Master Cutline Report

2. ETF High Volume Cutline Report

3. MF Cutline Report

In case you are not familiar with some of the terminology used in the reports, please read the Glossary of Terms.

Last Week In Review: ETF News And Blog Posts To 4/14/2013

Ulli Sunday, 14 April 2013, 8:01 AM Market Review Contact

In case you missed it, here’s a summary of the ETF topics and market reviews I posted to my blog during the week ending on 4/14/2013.

It now looks like the major indexes only took a breather the prior week before continuing their ascent towards a new milestone marker during the past five trading days, which would be the 1,600 level for the S&P 500.

While we did not quite get there, the benchmark nevertheless added 2.3% and touched the 1,593 level before pulling back slightly. Given that fundamental data points show an opposite picture of what the stock market indicates, we know, as I posted many times, that the driver of these rallies is the Fed’s enormous monthly money printing effort.

Be that as it may, we will continue to track the long-term trend as long as this orgy lasts and will follow our sell stop points to the exit doors; whenever that moment in time arrives.

Over past week, we covered the following:

One Man’s Opinion: Can The US Economy Really Grow By Almost 3% In 2013?

Ulli Sunday, 14 April 2013, 6:04 AM Market Commentary Contact

The recent plunge in gold prices indicate commodities are in the overbought region, and some kind of price pullback is likely to take place in near term, though there is some nervousness in the markets due to money-printing by global central banks, says Joe Quinlan, Chief Market Strategist at US Trust – Bank of America.

When questioned why he’s bullish on world economy, Joe said, barring Europe, the global economy has bottomed out. There’s no doubt that European problems will linger on, but they have been nearly offset by the US. Also, the emerging markets have started to recover. They have been easing monetary policies for the last 18 months, and the effects have started to kick in. Japan has started to recover and the world’s third largest economy will hopefully create some demand later. So essentially, growth should pick up by the second half of the year though we may see a pause in between. However, there could be more upswings in earnings, he observed.

Asked how 2013 is different from last year, when data started to become soft in the second quarter and continued to stay soft thereafter, Joe said retail and automobile sales are still strong this year while housing is kicking in. The big difference is that there’s no election in the US down the road. There are elections scheduled this year in Europe and it depends how Germany goes about it. But they are more of a concern for Europe than in the US, he noted.

New ETFs On The Block: SPDR Blackstone/GSO Senior Loan ETF (SRLN)

Ulli Saturday, 13 April 2013, 6:08 AM Income ETFs Contact

State Street Global Advisors (SSGA), the Boston, MA based distributor of exchange traded-funds, has combined forces with GSO Capital Partners, the global credit business of private equity behemoth Blackstone, to unveil the world’s first actively managed senior loan ETF – the SPDR Blackstone/GSO Senior Loan ETF (SRLN). If you are looking to invest in a liquid and cost-effective instrument for accessing the senior loan market may find SRLN attractive.

SRLN aims to preserve capital while delivering high current income and outperform both the Markit iBoxx USD Liquid Leveraged Loan Index (“the primary index) and the S&P/LSTA US Leveraged Loan 100 Index (the “secondary index”) by investing at least 80 percent of its assets (and any borrowings for investment purposes) in Senior Loans. For investment purposes, a first lien on senior secured floating rate bank loans is considered a Senior Loan.

Generally, senior loans are secured debts of US and non-US companies. Their rates are normally a few percentage points above LIBOR and are reset every three months, making them relatively stable investments in both rising and falling rate environments. Also below investment grade holdings can offer an attractive combination of higher yields and minimal duration, thus complementing traditional fixed income investments.

04-12-2013

Ulli Friday, 12 April 2013, 3:49 PM Newsletter Archives Contact

ETF/No Load Fund Tracker Newsletter For Friday, April 12, 2013

ETF/No Load Fund Tracker StatSheet

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

https://theetfbully.com/2013/04/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-04112013/

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Market Commentary

Friday, April 12, 2013

NEGATIVE EARNINGS AND ECONOMIC DATA DISRUPT WALL STREET RUN

The four day winning streak ended today as stocks succumbed across major averages. The S&P 500 led the way, falling 0.3%; the Nasdaq lost 0.2% and the Dow Jones industrial average closed fractionally lower.

Disappointing consumer data led the way. Retail sales in the U.S. dropped in March by the most in nine months. According to Commerce Department, purchases fell 0.4 percent, the biggest setback since June, after jumping 1 percent in February. The number is pointing to a slowdown in consumer spending as the first quarter drew to a close. Economists were prompted to trim consumer spending forecasts from what could be the best quarter in two years. Gains in hiring and wages will be needed to ensure any slowdown proves temporary as federal budget cuts and an increase in the payroll tax restrain the expansion.

Financial stocks were pressured on Friday by a pair of disappointing bank results and a delay in closing a large bank deal. All eyes were on JPMorgan (JPM) and Wells Fargo (WFC) today after both reported earnings ahead of the opening bell. Wells Fargo’s revenue came up short by $300 million at $21.3 billion. Shares of Wells dropped 0.8 percent while JPMorgan was off 0.6 percent.

At the New York Mercantile Exchange, metals and energy sank. Gold futures plunged as much as 5.3 percent to trade below $1,500 for the first time since 2011 and have now entered the bear market amid speculation Cyprus will sell reserves to raise cash. May oil settled at $91.29 a barrel, down 2.4%. A slump in materials has extended, marching to what could be the “death bell” (according to Citigroup) after the four-year rally.

It has been a spectacular week in the market where almost new records were formed every trading day. The Nasdaq rose 2.8%; the S&P 500 added 2.3%. It was the best weekly gain for both since the first week of the year. The Dow jumped 2.1%.

The Fed’s unprecedented bond purchases and three straight years of profit growth pushed the S&P 500 up almost 136 percent from its bear-market low in 2009. According to Goldman Sachs Group Inc. data, many of S&P 500 stocks with the most bearish bets rose 4.8 percent this week.

Is a correction going to happen next week or is the bull going to keep running? Is this the end of a nice run or the beginning of something big?

While no one has the answer to these questions, at least as trend followers we are not that concerned about needing to find one. Our low volatility equity ETF positions are in place and performing well; their sell stops have been identified and will be executed should the need arise.

That fact alone lets us sleep well at night.

In the meantime, our Trend Tracking Indexes (TTIs) went further into bullish mode, as the major indexes continued their march north.

For the week, we closed as follows:

Domestic TTI: +4.03% (last week +3.16%)

International TTI: +7.97% (last week +5.93%)

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 Doug:

Q: Ulli: I read in your material that you have exited some bond ETF positions because of sell signals in that area. Did that activity supersede the 7% stop that you had on those bond positions? In other words, did something other than the 7% decline in share price cause you to exit the positions? If so, what was it?

A: Doug: For bond ETFs, I use a 5% trailing stop loss, but overriding was the fact that some of our holdings BND, TIP, TLH had not only broken below their long term trend lines but were showing poor performance. While some did recover, I found better opportunities elsewhere, like in low volatility equity ETFs.

Again, in regards to stop losses, for broadly diversified domestic/international funds/ETFs, I use 7%, for bonds, I use 5% and for sector and country ETFs, I use 10%.

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Do you have the time to follow our investment plans yourself? If you are a busy professional who would like to have his portfolio managed using our methodology, please contact me directly or get more details at:

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/