ETF Insider: Flat And Thin

ETF Database

Two words come to mind when trying to describe market activity on Wall Street this past week: flat and thin. Major indexes traded sideways as fears from Europe sparked mini sell-offs one day, while encouraging data on the homefront helped stocks recover lost ground the next. Trading volumes also remain very thin, leading many to worry that the recent run-up on Wall Street could be due for a sour correction at the first sign of resurfacing uncertainties. Bernanke’s speech at Jackson Hole didn’t do much for markets as the Chairman reiterated the Fed’s position to hold off from further stimulus measures until deemed necessary [see also How To Pick The Right ETF Every Time].

Actionable ETF Trade Ideas Last Week’s Actionable ETF Ideas
Ticker Position Week Performance
UUP

Long

Down Arrow

-0.4%
BTAL

Long

Up Arrow

+0.1%
XLU

Long

Down Arrow

-0.7%

Our picks from Monday’s Insider posted a lackluster performance as two of them ended up in red territory during an otherwise uneventful week on Wall Street. Below, we highlight how our trade ideas fared during the week [sign up for a free trial of ETFdb Pro to get actionable ETF ideas every Monday, as well as access to more than 45 all-ETF model portfolios].

Trade #1 Long UUP: Down 0.4%

Despite resurfacing worries over debt drama in Europe, the U.S. dollar failed to take on safe haven appeal this week as anticipated. UUP traded lower from the opening bell on Monday and went on to extend its losses the following days. Trading activity on Thursday offered hopes for locking in gains on the week; however, UUP ultimately ended lower just pennies away from our recommended stop-loss as Friday’s closing bell rang. 

Trade #2 Long BTAL: Up 0.1%

This fundamentally defensive recommendation turned out well, although gains were by no means stellar. BTAL inched higher throughout the week, hitting a high at $23.34 a share on Tuesday. Lower beta stocks took the lead this week; however, they couldn’t manage to outperform their higher beta counterparts by a wide enough margin to generate a hefty profit. This trade ended up just barely higher on the week as the closing bell rang. 

Trade #3 Long XLU : Down 0.7%

This recommendation was mistimed. We had anticipated for XLU to resume its longer-term uptrend and bounce higher off the $36.50 level; instead, selling pressures remained persistent throughout the week and this ETF simply couldn’t march higher. XLU traded consistently lower every day, leaving us with a small, but frustrating, loss on the week. 

ETFdb Portfolios

Retirement ETFdb Portfolios

Our retirement portfolios ended up with lackluster returns this week as choppy trading across both stock and bond markets took its toll. From a year-to-date perspective, our 20 Years Til Retirement portfolio remains in the lead with double-digit gains on the year. 

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Regional ETFdb Portfolios

Although trading was fairly flat on Wall Street, overseas markets endured more profit-taking pressures. Our Euro Free Europe portfolio shed close to two points on the week, while not surprisingly our Ex-Europe portfolio proved most resilient. The Africa-Centric Portfolio remains in the lead from a year-to-date performance perspective. 

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Themed ETFdb Portfolios

Our Cheapskate Hedge Fund portfolio managed to clinch minor gains on the week with our Baby Boomers portfolio trailing closely behind; from a year-to-date perspective, the Baby Boomers strategy remains in the lead with double-digit gains. 

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Disclosure: No positions at time of writing.

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