ucsgears

Strength in Defensive Sectors

AMEX:IWM   ISHARES RUSSELL 2000 ETF
207 5 8
Since the Pullback in Oct             2014 - The Defensive Sectors are rocking and rolling. This means, investors are running for safety. Risk is being taken off from the Cyclical Sectors. - The Sensitive sectors (the largest distribution in the pool) with 40% weight on SPY             , 67% Weight on QQQ             , 35% on IWM             . This explains the new high with IWM             , and QQQ             not testing the high.

You can drill down deeper in finding the sector / industry that is stronger.
Sectors :
Healthcare - Heavy weight Defensive ( SPY             - 15%)
Consumer Staples             - Mid High Defensive (SPY-10%)
Utilities - Light Weight Defensive ( SPY             - 3%)

List of Industries in Defensive
Utility
Conventional Electricity, Telecommunication Fixed Line, Gas Distribution, Water
Healthcare
Biotechnology, Health Care Providers, Medical Equipment, Medical Supplies, Pharmaceuticals,
Consumer Staples            
Brewers, Distillers & Vintners, Drug Retailers, Food Products, Food Retailers & Wholesalers, Non Durable House Products, Soft Drinks, Tires, Tobacco

By Playing the Strong Sectors / Industries the odds are stacked in your favor,
Biotech had a great run during the last 2 years, and with that is quite risky (due to the nature) - is that really a defensive play?
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I keep it simple, trend never ends without a transition. Compare the individual industries, Utilities are a better bull due to the momo behind the trend.
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2use ucsgears
true, i try to keep it low in biotech though hurts seeing it rally and me keeping away. It has a high risk
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One of the major risk I can foresee in XLV is stringent regulation of prices on the drugs. Those outrageous drug prices will eventually capture some attention and govt will step in. It will shake the market a bit more than it can help.
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Wow, really good explanation in text!
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