Some analysts were questioning the rally in early June because utilities, a conservative sector, were outperforming the market. [ETF Chart of the Day: Utilities]
Gayed notes that other defensive sectors such as consumer staples and healthcare are the most richly valued. [Consumer Staples ETFs for Defense]
Meanwhile, aggressive sectors such as industrials, financials and energy are among the “cheapest” sectors from a pure valuation standpoint.
“Income has become very expensive, while growth has become very cheap,” he said.
The chart below shows the relative performance of the utilities ETF versus the S&P 500.
