CSD has another potential catalyst that could work in its favor. The ETF’s largest holding is Irish drugmaker Mallinckrodt (NYSEArca: MNK), a stock that could be primed for a short-covering rally as 27.2% of its shares are sold short, according to Business Insider.
Contributing to CSD’s near- to medium-term upside potential is the recent strength being seen from the consumer discretionary sector. Regarding CSD, investors will want to keep an eye media stocks because the ETF allocates over 9% of its combined weight to Liberty Media (NasdaqGS: LMCA) and News Corp. (NasdaqGS: NWSA).
The good news, no pun intended, is that media stocks are rebounding as highlighted by the 5.4% gain over the past month for the PowerShares Dynamic Media Portfolio (NYSEArca: PBS).
Guggenheim Spin-Off ETF
Tom Lydon’s clients own shares of IWM.