ETF Trends
ETF Trends

The strategy for retailers throughout this recession has been value, as the larger stores are staying on top of the markets and exchange traded funds (ETFs) by adjusting advertising and marketing strategies, accordingly.

The major stores have gotten the message, and the value aspect of whatever they are selling is what makes the sale. Despite a healthy dose of numbers for the month of March in the retailers earnings reports, consumers are sticking with the basics, such as food, gas, vitamins and candy, reports Stuart Elliot for The New York Times.

Read my blog post at CNBC about how to play value in a recession.

Although value means more than low prices, the consumer is proving that they are fixated solely on cost at this point. Campaigns from Home Depot (HD), J.C. Penny (JCP) and Whole Foods (WFMI) are all incorporating word phrases such as more saving, price matters and everyday value.

In the midst of this troubled economy, the biggest goal for any retailer is just getting the consumer through the door. Therefore, an extraordinary performance within the store is the goal, along with value and low prices. Right now, advertisers are stepping up their game to try and beat the odds against tight consumer  wallets.

  • SPDR S&P Retail (XRT): up 22.8% year-to-date; Best Buy Co. (BBY), 2.1%; J.C. Penny Co., 2.1%; Expedia (EXPE), 2.1%; Sears Holding Co. (SHLD), 2.2%; CarMax Inc. (KMX), 2.1%; Target (TGT), 2.1%; Family Dollar Stores (FDO), 2%

It looks like many luxury-focused retailers are scaling back, as well. One former CEO said it was the sharpest consumer retrenchment he had ever seen, says Women’s Wear Daily. The whole economy is coming off a period of exceess, and it’s spelling trouble for high-end fashion.

What it will mean for the Claymore/Robb Report Global Luxury (ROB), which is down 4.6% year-to-date.

For full disclosure, Tom Lydon’s clients own shares of XRT.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Mr. Lydon serves as an independent trustee of certain mutual funds and ETFs that are managed by Guggenheim Investments; however, any opinions or forecasts expressed herein are solely those of Mr. Lydon and not those of Guggenheim Funds, Guggenheim Investments, Guggenheim Specialized Products, LLC or any of their affiliates. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.