Weekly StatSheet For The ETF/No Load Fund Tracker Newsletter – Updated Through 02/09/2012

Ulli ETF StatSheet Contact

ETF/Mutual Fund Data updated through Thursday, February 9, 2012

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

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 broken above its long term trend line (red) by +5.08%. Be sure to tune into my blog for the latest updates.

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Greek Deal Or No Deal: What’s Next For ETFs?

Ulli Market Review Contact

[Chart courtesy of MarketWatch.com]

With Greece making headway in its bailout deal today, the S&P 500 had a minor gain of 0.15% while European markets finished on the upside. The Euro also edged up to $1.33/Euro.

And once again, the 10-year Treasury breached the 2% level, finishing at a yield of 2.05%. It looks like the Greek news tempered investor fear for the time being, but it doesn’t mean that risk has substantially dissipated.

After a tussle amongst various political parties, Greece agreed to a roughly $4.3 billion austerity package as it seeks to demonstrate it can reign in fiscal discipline. While no guarantee that this measure will help Greece receive its bailout payment, it sure increases Greece’s chances.

However, there’s a lot of negotiating left and plenty of things that can still go wrong, leaving Greece in the danger zone where it has only bought itself some extra time.

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Low Volatility Continues for ETFs

Ulli Market Review Contact

[Chart courtesy of MarketWatch.com]

Markets moved forward once again as the S&P 500 rose 0.22%. Nevertheless, European markets erred to the downside. While it seems like markets have discounted the Greek situation, there’s no promise that market price stability will persist.

Overall, there wasn’t much volatility across U.S. indices, currencies, Treasuries, or commodities today. The VIX went up over 2%, but this pales in comparison to the major price swings we witnessed in late 2011.

Meanwhile, an emergency meeting will be held among European finance ministers to discuss Greece. Greek PM Papademos finally met with party leaders today after delays to try and iron out a resolution. Whether Greece can institute fiscal reforms such as a 20% minimum wage cut remains the big unknown. Ultimately, a 50%-70% haircut on current bonds with the promise of new bonds is no cure for Greece’s financial irresponsibility. Renewed fiscal discipline must come from within the political coffers.

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7 ETF Model Portfolios You Can Use – Updated through 2/7/2012

Ulli Model ETF Portfolios Contact

January’s upward momentum continued into February, as the S&P 500 jumped some 2.6% since last week’s ETF Model Portfolio report. All models moved higher as well with 3 of them (#3, #4, #5) outperforming the index on a YTD basis.

While that is nice, it is not nearly as important as having some kind of diversification for that moment when downside risk kicks in again. It’s just a matter of time for this rally to run into some kind of a stumbling block, which is why it’s crucial for you to have your exit strategy in place.

If you follow these models, you will find the sell stop tracking on the right hand side of each matrix.

Take a look at the latest ETF Model Portfolio update:

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Major Market ETFs Make Small Gains — International Buy Signal Generated

Ulli Market Review Contact

[Chart courtesy of MarketWatch.com]

There wasn’t any major action in markets today as the S&P 500 only moved up 0.20%. And although Europe’s problems haven’t gone away, the Euro has picked up lost ground against the dollar, now sitting at $1.33/Euro.

Although the 10-year Treasury rose to 1.97%, the fact that it’s below the 2% mark nevertheless indicates significant risk aversion among investors given continued difficulties in Europe.

With regards to Greece, a clear resolution is still not in sight as it missed another bailout deadline as talks keep getting pushed out due to internal dissension among Greece’s political parties.

At this point in time, Greece still has to come to an agreement with the Troika over the details of its $170 billion plus rescue deal. Adding in more strikes from the unions and persistent public sector backlash, Greece has a substantial hurdle to overcome if it stands any chance of receiving bailout funds.

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ETFs Return To An Uncertain Middle Ground

Ulli Market Review Contact

After last Friday’s major gains, markets tempered quite a bit today as the S&P 500 barely dipped 0.04%. European and Asian indices didn’t move significantly either for the most part. In commodities, oil and gold haven’t greatly fluctuated as of late as well.

The 10-year Treasury yield fell down to 1.90% as it appears investors are slightly more on edge about Greece’s fate. The VIX might still be below 20, but there’s still plenty of risk on the table.

As Greece still hasn’t come to a deal with its bondholders, the prospect of default becomes increasingly likely. Even Greek PM Papademos wants his finance team to determine the potential effects of a default. And the rest of Europe is getting antsy over the matter. Merkel and Sarkozy both said that Greece needs to arrive at a resolution soon. If not, the market reaction could turn ugly.

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