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After a multi-year rally, the equities market is trading at elevated valuations. Consequently, investors seeking exposure to stocks may want to consider a smart-beta, multi-factor exchange traded strategy to limit risks and potentially enhance returns. “High Valuations and limited multiple expansion may hinder broad market returns,” Steve Deroian, Head of ETF Strategy at John Hancock […]

More exchange traded fund investors are looking to smart beta or alternative index-based strategies to fill out their investments, and focusing on which targeted factors within the indexing methodology matters when appropriately balancing a portfolio. On a recent webcast, Smart Beta Factors: How Many and What is Ideal?, Joel Schneider, Senior Portfolio Manager and Vice […]

After the U.S. dollar experienced one of its worst quarters in six years, the weaker greenback may help boost some areas of the market and sector-specific exchange traded funds. “The biggest beneficiaries of all of this are going to be the industrials, who are very export sensitive,” Boris Schlossberg of BK Asset Management told CNBC. […]

John Hancock has filled out the gaps in its smart-beta exchange traded fund suite with five new sector-specific ETFs backed by Dimensional Fund Advisors’ research-based factor investing. According to a press release, John Hancock’s new funds include: John Hancock Multifactor Consumer Staples ETF (NYSEArca: JHMS) John Hancock Multifactor Energy ETF (NYSEArca: JHME) John Hancock Multifactor […]

The market sell-off has dragged on growth stocks. With the Nasdaq recovering, some sector exchange traded funds may surprise investors. While a rebound in growth stocks may cause investors to turn back to the PowerShares QQQ (NasdaqGM: QQQ), which tracks the tech heavy Nasdaq-100, the technology sector may not be the best area to look […]

The earnings season has been disappointing and weighed on investor confidence through one of the worst starts to a new year. Nevertheless, there are some areas that may pull through the malaise, with decent growth propping up the sector-related exchange traded funds. Aggregate fourth quarter 2015 S&P 500 earnings-per-share are expected to fall 4.94% year-over-year, […]

The sell-off in the oil markets has weighed on capital spending from the energy sector as producers hold off on new projects, pressuring U.S. industrial companies and sector-related exchange traded funds. Over the past year, the Industrial Select Sector SPDR (NYSEArca: XLI) declined 10.8%, Vanguard Industrials ETF (NYSEArca: VIS) dropped 9.2%, iShares U.S. Industrials ETF […]

After a Federal Reserve-induced multi-year rally in equities, exchange traded fund investors pulled out of U.S. stocks and shifted into international markets where people may still find more attractive valuations. For instance, the WisdomTree Europe Hedged Equity Fund (NYSEArca: HEDJ) was the most popular ETF of 2015, attracting close to $14.0 billion in net inflows […]

The month of December has been one of the strongest periods of the year for equities, and some areas of market and sector-related exchange traded funds may stand out during the Santa Claus rally. Over the past month, the SPDR S&P 500 ETF (NYSEArca: SPY), iShares Core S&P 500 ETF (NYSEArca: IVV) and Vanguard 500 […]

If the Federal Reserve moves toward interest rate normalization in December, some market segments and sector exchange traded funds could underperform during the rising rate environment. Erin Gibbs of S&P Investment Advisory Services is singling out the industrial and materials sector since both higher rates and a stronger dollar would put pressure on these two […]

Industrial Bellweather Caterpillar (NYSE: CAT) is dragging down the industry and sector-related exchange traded funds after revealing some belt-tightening measures and a weaker outlook in light of the depressed commodities markets. Caterpillar plunged as much as 7.9% Thursday. The company stocks declined after it announced cuts of up to 10,000 jobs over four years and […]

Some are crediting me with calling the 6-day mini-crash. On the contrary. When I wrote “15 Warning Signs Of A Market Top” on August 18, the intent was to discuss micro-economic (corporate), macro-economic, fundamental and technical reasons for reducing one’s overall allocation to riskier assets. I did not predict the epic fall from grace for […]

Materials sector exchange traded funds could stuck in a rough patch as chemical industry activity slows. The Chemical Activity Barometer (CAB), which tracks production, inventory and selling prices of numerous chemicals, along with prices of chemical stocks, only rose 1.8% in August year-over-year, the slowest pace since 2012, reports Anthony Feld for Bloomberg. Kevin Swift, […]

A fair number of commenters, callers and perma-bulls were relatively tough on me in May when I suggested a strategic decision to raise cash levels. They were even tougher on me when I mentioned the possibility of picking up safer havens like intermediate treasuries via iShares 7-10 Year Treasury Bond (IEF) and intermediate-to-long duration municipal […]

In the first seven months of 2015, the S&P 1500 Airline index declined 11%, as we think investors focus on capacity additions with a worrying eye.  However, S&P Capital IQ thinks that airline execs have learned from past costly mistakes on adding too much capacity and forecasts 2015 as a record profitability year, driven by […]

Investment Guru Warren Buffett acquired Precision Castparts (NYSE: PCP) for $37.2 billion on Monday, marking a potentially bullish outlook for aerospace manufacturing and sector-related exchange traded funds. Precision provides parts like fasteners and turbine blades to aircraft makers, along with pipes and other equipment for power states and oil-and-gas industry, reports Chelsey Dulaney for the […]

The equities market is headed into its worst month of the year, and exchange traded fund investors should take particular care with financial sector stocks. According to MKM Partners market technician Jonathan Krinsky, over the past decade, June has been the worst month of the year for stocks, with the S&P 500 averaging a 1.32% […]

Investors can capitalize on a shifting market and changing business cycles through sector-specific exchange traded fund plays. On the recent webcast, Strategizing with Sectors, Jared Rowley, Research Strategist for State Street Global Advisors, pointed out that different sectors show varying correlations to the benchmark S&P 500 index. [Sector ETFs to Capture Cyclical Trends] For instance, […]

Long-term exchange traded fund investors should take the time to evaluate market conditions to tap into potential opportunities and diminish rising risks. “To build a better equity portfolio, it pays to think cyclically, and to revisit sector investing,” write Archan Basu, senior vice president of portfolio construction guidance at Fidelity Financial Advisor Solutions, and Dirk […]

A strong U.S. dollar and the decline in capital expenditure due to low oil prices could pressure the industrial sector and related exchange traded funds ahead. Year-to-date, the Industrial Select Sector SPDR (NYSEArca: XLI) was up 0.3%, Vanguard Industrials ETF (NYSEArca: VIS) was 1.7% higher and iShares U.S. Industrials ETF (NYSEArca: IYJ) gained 3.0%. U.S. […]

The Dow Jones Transportation Average, along with sector-related exchange traded fund, has been under heavy pressure over the past week. Nevertheless, with the Dow Jones Industrial Average maintaining its momentum, transports may still stage a rebound. The iShares Transportation Average ETF (NYSEArca: IYT), which tracks the Dow Jones Industrial Average Index, fell 4.9% over the […]

Many feared that the low energy prices would have a wide effect on U.S. industries and industrial sector-related exchange traded funds, but concerns may have been overblown. The Industrial Select Sector SPDR (NYSEArca: XLI) has dipped 2.0% year-to-date, while the SPDR S&P 500 ETF (NYSEArca: SPY) has declined 1.7%. Capital expenditure still remains robust, despite […]

Exchange traded fund traders who are picking and choosing their overweight market exposures may want to stick to industrials and avoid materials. The Industrial Select Sector SPDR (NYSEArca: XLI) has held onto a long standing up-trend since the late 2011 lows, writes Julius de Kempenaer for Relative Rotation Graphs. However, industrials experienced a short interruption […]

Industrial-sector exchange traded funds may take an indirect hit from the depressed oil prices as energy producers are forced to cut back on planned projects and spending for manufactured goods. For instance, the Industrial Select Sector SPDR (NYSEArca: XLI) holds large industrial companies with significant exposure to the oil services industry, such as General Electric […]

While the U.S is diminishing its standing military presence overseas, namely in the Middle East, other countries have picked up the slack, potentially fueling growth in defense sector stocks and related exchange traded funds. Year-to-date, the iShares U.S. Aerospace & Defense ETF (NYSEArca: ITA) rose 10.9%, PowerShares Aerospace & Defense Portfolio (NYSEArca: PPA) increased 14.2% […]

When overweighting a specific sector, exchange traded fund investors should monitor their underlying holdings or risk becoming overexposed to a single company stock. Most ETFs try to reflect the performance of an underlying index, and many benchmarks are market capitalization-weighted, so the largest companies make up the largest weights. While many broad index ETFs diversify […]

The U.S. equities are expected to strengthen next year, but energy and industrial sector-related exchange traded funds could trail the broader markets. The Energy Select Sector SPDR (NYSEArca: XLE) has already fallen behind the S&P 500, declining 8.3% year-to-date, compared to the S&P 500’s 13.6% rise. Meanwhile, the Industrial Select Sector SPDR (NYSEArca: XLI) is […]

Despite calls that a strengthening dollar and a decline in oil prices would hurt the industrials sector, industrial-related exchange traded funds have been outperforming the broader market over the past month. The Industrial Select Sector SPDR (NYSEArca: XLI) is up 8.3% over the past month, compared to the 6.5% rise in the S&P 500 Index. […]

Large, multi-national industrial companies have issued positive forward guidance, potentially lifting the industrial sector exchange traded fund outlook for this quarter. Over the past week, the Industrial Select Sector SPDR (NYSEArca: XLI) has increased 4.2%, Vanguard Industrials ETF (NYSEArca: VIS) gained 4.5% and iShares U.S. Industrials ETF (NYSEArca: IYJ) rose 3.9%. Nevertheless, the sector has […]

After a string of better-than-expected economic data, investors are rotating back into cyclical sector stocks and related exchange traded funds. “The jobs report is clearly a sign of continued and accelerating strength of the economy,” Jeff Korzenik, Chicago-based chief investment strategist at Fifth Third Bancorp., said in a Bloomberg article. “The cyclical leadership in many […]