7 ETF Model Portfolios You Can Use – Updated through 1/31/2012

Ulli Model ETF Portfolios Contact

There was not much change in the S&P 500 since last week’s report, as momentum seemed to have slowed down towards the end of the month.

Contributing factors were the never ending European soap opera, mixed U.S. economic reports and simply a market running out of gas after a solid start in 2012.

Our ETF model portfolios fluctuated with their stated objectives, but surprisingly, the moderate version (#4) has been outperforming the aggressive one (#3)

Take a look at the latest ETF Model Portfolio update:

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Major Market ETFs Sitting On The Sidelines

Ulli Market Review Contact

[Chart courtesy of MarketWatch.com]

There wasn’t much moving and shaking in the markets today despite a gloomy atmosphere in Europe. The S&P 500 dipped a mere 0.05%, but the index had its best January performance in 15 years, returning 4.36%. Although it might be The January Effect, please read my recent piece about the importance of a long-term outlook.

Once again, the 10-year yield fell, indicating a risk perception as investors fled to fixed income. Finishing the day at a yield of 1.80%, this is the lowest level in nearly 4 months.

The Greek finance minister has now alluded to a deal where bondholders may have to take a haircut in excess of 70 percent. This is surely a big potential setback from bondholders, but more importantly, it doesn’t mean that Greece’s debt issues will be solved regardless of whether or not it receives additional bailout funds.

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No Major Moves For Equity ETFs, But That May Soon Change

Ulli Market Review Contact

[Chart courtesy of MarketWatch.com]

Although falling deeper earlier in the day, the S&P 500 only finished down 0.25%. Overall, the S&P 500 hasn’t greatly fluctuated as of late, but the VIX index spiked over 5%, indicating that more volatility might be coming. Nevertheless, European and Asian indices were down by a larger magnitude.

While currencies and commodities were relatively flat on the day, the 10-year Treasury fell to 1.84%, signifying more flight to safety. Understandably, the situation in Greece, which is the main focus at the moment, has spooked a number of us.

The friction in Greece continues as the Greeks demonstrated strong resistance to the German proposition that the Eurozone take charge of Greece’s budgetary matters. However, as Greek PM Papademos highlighted, the country will face bankruptcy if it can’t obtain additional bailout funding. The bottom line is that Greece has been inept in instituting fiscal reform, unable to meet its budget targets and failing to demonstrate that it can be financially self-sufficient in the long-run.

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ETFs/Mutual Funds On The Cutline – Updated Through 1/27/2012

Ulli 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 293 (last week 264) 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. 59 ETFs (last week 45) have managed to move into in bullish territory after the recent run up.

The third report covers Mutual Funds on the Cutline. There are currently 681 (last week 603) above the line and 180 below it out of the 861 that I follow.

Take a look:

1. ETF Master Cutline Report

2. ETF High Volume Cutline Report

3. MF Cutline Report     

Last Week In Review: ETF News And Blog Posts To 1/29/2012

Ulli 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 1/29/2012.

Upward momentum slowed down this past week, as the S&P 500 ended almost unchanged. Earnings were mixed; some economic reports were uninspiring with the Fed announcing continued low interest rates into 2014.

The metals, along with bond ETFs/Funds rallied as the zero interest rate policy is an indication that all is not well economically speaking. It’s still unclear as to whether the Fed will launch another Quantitative Easing effort (QE-3) to lend another assist.

In the meantime, the events in Europe are taking center stage as efforts are being made to save the European banks from having to take steep losses in foreign debt.

This week, we covered the following:

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A Bleak Future Is In Store For Europe

Ulli Market Commentary Contact

Only time will tell if the Eurozone will overcome this debt crisis. However, Europe faces a near certain reality of economic stagnation. With the amount of austerity that has been put in place, prospects for growth are dire indeed.

Not only is the economy likely to contract this as suggested by the IMF and others, but forward progress in the years following will be very slow as suggested in a recent interview with hedge fund manager George Soros.

In what he calls an impending “lost decade” for the EU, the recent austerity measures by PIIGS members especially, will put a damper on economic growth and likely keep unemployment high while creating deflationary pressures. In a deflationary environment, the real value of debt increases, creating a vicious cycle where the public and private sectors have additional hurdles to pay off debt.

Given Europe’s declining financial condition, it’s critical to understand the potential ramifications this can have for global markets and your portfolio on a short-term and long-term basis.