05-17-2013

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ETF/No Load Fund Tracker Newsletter For Friday, May 17, 2013

ETF/No Load Fund Tracker StatSheet

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

https://theetfbully.com/2013/05/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-05162013/

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Market Commentary

Friday, May 17, 2013

BULLS NOWHERE TO GO BUT UP

Stocks continued their climb into uncharted territory today and more than made up for yesterday’s sell off. The Dow Jones Industrial Average and the Standard & Poor’s 500 finished at fresh record highs, driven by gains in energy and industrial shares. The indexes have pushed to a series of never-before-seen levels as part of the rally that has lifted equities more than 16 percent for the year so far.

The Dow closed higher by 121 points (0.8%) at 15,354, the S&P 500 Index increased 15 points (1.0%) to 1,666, and the Nasdaq Composite ascended 34 points (1.0%) to 3,499. Volume was 7% lower on the Nasdaq but 17% higher on the NYSE compared to Thursday, according to preliminary data. The volume data may have been skewed by the expiration of stock options.

The market has been racking up gains for the fourth week in a row as consumer confidence rose higher than expected and a gauge of future economic activity rebounded. The Reuters/University of Michigan Consumer Sentiment Index jumped 7.3 points in the preliminary May reading to 83.7, the highest level since July 2007.

Economists expected a modest 1.6-point gain to 78.0. If the reading is maintained for the full month, it would be the biggest increase since September 2009. The latest sentiment reading corresponds to 3.3% real GDP growth and suggests improved economic activity in the fall. One-year inflation expectations were stable at 3.1%. The Conference Board’s Leading Economic Index (LEI) rose 0.6% in April, double the consensus. The index is at its highest level since June 2008. Seven of its ten components improved, led by building permits, interest rate spread, and jobless claims. The report suggests “economic growth will remain positive in the upcoming months and may even pick up slightly toward the end of the year.”

Despite some disappointing global economic data and festering uncertainty regarding when the Fed will take its foot off of the economic stimulus accelerator, stocks continued to post record highs this week.

The bulls shrugged off a plethora of data: the Chinese economy continued to slow, the Eurozone recession hit a record length, Japanese business spending remained sluggish, and manufacturing activity in New York and Philadelphia unexpectedly contracted.

But recent improvement, including in the labor market and retail sales, has suggested the recovery remains resilient. For the week, the Dow advanced 1.6 percent, while the S&P 500 climbed 2 percent and the Nasdaq rose 1.8 percent. JPMorgan raised its year-end target for the S&P 500 to 1,715 from 1,580, implying a gain of less than 3.5 percent for the index for the rest of the year.

Our Trend Tracking Indexes (TTIs) headed higher with the market indexes and closed the week as follows:

Domestic TTI: +5.07% (last week +4.56%)

International TTI: +10.09% (last week +9.30%)

We remain fully invested subject to our trailing sell stops.

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 Ed:

Q: Ulli: What are your thoughts on the PRPFX Fund with gold having dropped so fast??

A: Ed: I don’t own it, since it is hovering below its long-term trend line. There are far better opportunities in low volatility ETFs.

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WOULD YOU LIKE TO HAVE YOUR INVESTMENTS PROFESSIONALLY MANAGED?

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/

ETF/No Load Fund Tracker Newsletter For Friday, May 17, 2013

Ulli ETF Tracker Contact

ETF/No Load Fund Tracker StatSheet

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

https://theetfbully.com/2013/05/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-05162013/

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Market Commentary

Friday, May 17, 2013

BULLS NOWHERE TO GO BUT UP

Stocks continued their climb into uncharted territory today and more than made up for yesterday’s sell off. The Dow Jones Industrial Average and the Standard & Poor’s 500 finished at fresh record highs, driven by gains in energy and industrial shares. The indexes have pushed to a series of never-before-seen levels as part of the rally that has lifted equities more than 16 percent for the year so far.

The Dow closed higher by 121 points (0.8%) at 15,354, the S&P 500 Index increased 15 points (1.0%) to 1,666, and the Nasdaq Composite ascended 34 points (1.0%) to 3,499. Volume was 7% lower on the Nasdaq but 17% higher on the NYSE compared to Thursday, according to preliminary data. The volume data may have been skewed by the expiration of stock options.

The market has been racking up gains for the fourth week in a row as consumer confidence rose higher than expected and a gauge of future economic activity rebounded. The Reuters/University of Michigan Consumer Sentiment Index jumped 7.3 points in the preliminary May reading to 83.7, the highest level since July 2007.

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Weekly StatSheet For The ETF/No Load Fund Tracker Newsletter – Updated Through 05/16/2013

Ulli ETF StatSheet Contact

ETF/Mutual Fund Data updated through Thursday, May 16, 2013

Table of Content082312

If you are not familiar with some of the terminology used, please see the Glossary of Terms.

 

1. DOMESTIC EQUITY MUTUAL FUNDS/ETFs: BUY — since 10/25/2011

TTI

The domestic TTI broke through its long-term trend line generating a Sell for this area effective 8/9/2011. Over the recent past, we’ve seen the TTI hovering slightly below and above this dividing line between bullish and bearish territory. The clear break to the upside occurred on 10/24/11 and, effective 10/25/11, a new Buy signal for domestic equities went into effect.

As of today, our Trend Tracking Index (TTI—green line in above chart) has bounced off its long term trend line (red) by +4.99% as part of the post election rebound.

To avoid a potential whip-saw, a Sell signal to move out of all domestic equity positions will be generated once we have clearly pierced the line to the downside. Be sure to tune into my blog for the latest updates.

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Too Much Bad News To Handle

Ulli Market Commentary Contact

Thur pic

[Chart courtesy of MarketWatch.com]

After trading in a narrow range through out the day, US index ETFs finished lower as investors turned negative following lackluster economic data and mixed earnings reports. Today snapped a string of record-high closes. The Dow Jones Industrial Average (DJIA) depreciated 42 points (0.3%) to 15,233, the S&P 500 Index was 8 points (0.5%) lower at 1,650, and the Nasdaq Composite fell by 6 points (0.2%) to 3,465. Wal-Mart lost 2.2 percent after the world’s largest retailer forecast second-quarter profit that was less than analysts estimated as the slow U.S. economy and higher taxes put pressure on consumers.

In a day full of economic news, initial claims for unemployment insurance jumped 32,000 last week, the most since November 2012, to 360,000, and above the consensus of 330,000. The Labor Department said that these figures were not impacted significantly by sequester-related furlough or other special factors. The four-week average of claims increased 1,250 to 339,250, but is still near its lowest level since January 2008, as the downward trend in firings remains intact.

Housing starts dropped 16.5% in April to 853,000 units at an annual rate, below the consensus of a 6.4% decline to 970,000 units. On the other hand, building permits, a sign of future construction activity, surged 14.3%, the second most on record, to a 1.017 million unit annual rate. The rate was above a million for the first time since June 2008. Economists expected a smaller 2.5% gain to 930,000 units. On a y/y basis both starts and permits continue to post double-digit gains.

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Defying Negative Data

Ulli Market Commentary Contact

Wed pic

[Chart courtesy of MarketWatch.com]

Despite disappointing US industrial production and regional manufacturing reports, the major domestic equity markets were able to continue their recent rally and finish the trading session higher. The Dow Jones Industrial Average added 60 points (0.4%) to 15,276, the S&P 500 Index was 8 points (0.5%) higher at 1,659, setting another record in nine of the past 10 sessions, and the Nasdaq Composite gained 9 points (0.3%) to 3,472.

Stocks opened in the red as domestic and foreign economic data reminded investors of a cloudy growth picture. However, defensive sectors quickly overshadowed the early losses, and helped the broader market erase its early weakness.

Consumer staples and utilities outperformed as the two sectors settled with respective gains of 1.0% and 0.8%. The health care space lagged behind its defensively-geared counterparts as biotechnology became the subject of some profit taking following its recent run. Most other cyclical groups were somewhat shaky as the energy sector spent the day in negative territory. Crude oil was down as much as 2.0% before recovering those losses to end little changed at $94.30.

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7 ETF Model Portfolios You Can Use – Updated through 5/14/2013

Ulli Model ETF Portfolios Contact

And the beat goes on. After a slight breather on Monday, the major market ETFs took off again yesterday and set some new highs in the process. The S&P 500 gained +1.48% since last week’s ETF Model Portfolio report.

Needless to say, it’s been equities all the way this year with bonds getting pushed aside while precious metals have been spanked, which is reflected in the lack of performance of funds like PRPFX and its ETF equivalent.

As I have posted before, star performers so far this year have been the low volatility ETFs, such as XLP and SPLV, which we own in my advisor practice. I simply like their lower beta which, at least in theory, will reduce the speed with which things will go down but, in this manipulated market environment, you can’t be 100% sure. When this bubble bursts, as it eventually will, we will rely on our sell stops and/or trend line breaks to get us safely to the sidelines.

Here’s the latest update:

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