growth to value ratio showing signs of breaking down$AMEX:SPYG/AMEX:SPYV appears to be close to or breaking an uptrend.
What traders are saying
relief for this growth indexthe fed has quietly halted bottom line reductions of the balance sheet, markets should rally leading into the holiday season and then tank once again. Short term view bullish.
Long
The growth vs value ratios are making higher lowsAt the above pane is the SP:SPX making new lows; I really thoght that the low was already made.
Then in red in Small Cap Growth vs Small Cap Value (IWO/IWN), in green is the S&P Growth vs S&P Value (SPYG/SPYV) and in yellow is the Consumer Discretionary vs Consumer Staples (XLY/XLP).
There are a lot more but these are the most common ratios to evaluate what kind of stocks are leading. And if you want a bull market, then growth should lead right?
Well, we are seeing the first steps to it. Look how all peaked before the S&P 500 and now are making higher lows. But remeber, first steps.
Look for stocks that are making 6mo highs and 12mo highs. These should be the ones to lead the next cycle.
NYSE:DV , NASDAQ:DGII & NASDAQ:AEHR are in the top of my watchlist.
What are yours?
Long
Leading ratio to spot bull marketsThe eternal battle, growth vs value. This ratio AMEX:SPYG / AMEX:SPYV has helped in the past in spotting peaks and throughs of the SP:SPX . But for the las few years, is better at timing bottoms.
It did in the 2018 correction, in the Covid crash of 2019 and is doing it now. The ratio starts to go up just before the market does. Because that's what a bull market is, high risk assets outperfom low risk assets.
In healthy markets, Growth outperfomrs Value!
As for now, I'll pay close attention to determine the strength of the market. If this ratios does well, the market should do well.
Long
S&P Growth (SPYG) Channels since 2002 - Way, Way Above NormalFYSA, SPYG tracks teh top 50 largest securities in the S&P 500. Holds 5 of the 6 FAAMNG stocks, which accounts for 39% of the ETF.
I laid out what I see as the 4 main channels for SPYG. It is clearly obvious that it the current trend is way above the trend from both the 2002-2008 and 2010-2019. You can see the 2020-22 rally was an extension of a trend that started in 2019 that was interrupted by the COVID crisis. It truly was the once in a life time opportunity for most traders.
Now the more subjective part. This really depends on if you believe the market will eventually return to the mean. To me, it looks like the party is over and we are going to see a return to one of the lower channels in the coming months and years. We could see a 2nd attempt to test the red channel, but the outlook with reduced QE and continued challenges from inflation, Russia, and Covid are not fertile ground for this continued irrational market behavior. The most obvious trend change to me would be to work its way down in to the blue channel, probably stepping down on the major support/resistance lines. Not sure if it would be better to slowly do this, or end up with a 2000 or 2008 crash. At least a crash has major opportunities for VIX ETFs and its like a band-aid.
Check out the 1D chart below. You can see how the price jumps around the channel edges.
1W
1D
I do not care if you rally....but please rally "right" :).
The current rally is largely driven by the so called "growth complex" - companies that sell dreams instead earning cash. In a perfect text book world this should not happen at all, particularly given the explosive rise in inflation expectations.
Yes, the market is always right, and far too big to argue with, but still.. meme stock traders need to get familiar with cash flow analysis instead of wasting their time on Reddit boards.
Just saying :).
Growth vs ValueGrowth is down 1.93%, while value is down only 0.17%. This suggests that the current rut can still be characterized as a rotation rather a broad sell-off. Should vol spike higher this can of course change quickly.
Putting the rotation into contextGrowth lost about 1% today, while value gained 0,6%. So instead of a pure sell off we rather have a rotation at hand. But lets take a view from 30.000 foot above and put that rotation into context: Starting 2020 the growth/value ratio increased about 50% as illustrated in the chart, what renders today's retracement very marginal. The reason behind the move is straight forward: Rate hike expectations are moving up and hit the highest level sind March 2020 today (red line). Should the correlation between federal fund quote future contracts and the growth/value ratio stay intact, and price pressures further increase then growth is certainly in for a quite a ride. On the other hand side the short growth/long value trade is a well known "widow maker". Time will tell.
Short
SPX's Value Vs. Growth, "Do not let them get you this time"big guys in the market, the" Market Makers" are rotating their assets from
growth to value, this signal happened twice in 20 years !!!! I need to spend some
time on this they say it is a good strategy to follow. we shall see how
can we analysis it in the future. I hop our community would shed some light
on this matter.
Large cap growth ETFsRUT was the last major index to have the golden cross.
Will small cap value ETF (IWN) or small cap growth ETF (SLYG) finally catch up?
$SPYG: An ETF that holds the winners of the "coronavirus market"Recently, I have been cleaning up my Roth IRA and other qualified retirement accounts. Most analysts are now recommending the move out of U.S. Treasury bonds due to their low-yields (and almost certain – continued low yield over the next decade!).
I am a fan of ETFs for long-term investing. The benefits are numerous compared to stock selection and mutual funds. Access to highly priced stocks (Alphabet, Amazon, etc.), monthly distributions, and low expense ratios, are just a few of the benefits to ETFs for retirement accounts.
Which brings us to $SPYG or the SPDR Portfolio S&P 500 Growth ETF. SPYG holds the winners (or should I say survivors) of the current market. The current breakdown of the fund is $MSFT (10.11%), $AAPL (9.66%), $AMZN (7.87%), $FB (3.72%), $GOOGL (2.80%), $GOOG (2.73%), $V (2.13%), $MA (1.73%), $NVDA (1.53%), and $NFLX (1.39%).
Analysts rank $SPYG highly – FactSet ($FDS) gives the ETF an A rating and XTF.com rates $SPYG a perfect 10.0 out of 10.0.
The technical analysis shows that the fund has recovered nicely since the March lows. Even with the risk of another Covid-19 outbreak, $SPYG holds companies proven to survive – perhaps even thrive – in the new market.
Long 100 $SPYG @ 42.46. Total Long 1000 $SPYG (accumulated lots).
Long
Low Cost ETFs That Beat The Market Low cost ETF's that beat the market:
(Note these lean Growth, Tech, & Large-Cap Heavy)
Add slow and steady now; Add heavy when we retest the black trend-line
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Ticker: SPYG
Name: SPDR Portfolio S&P500 Growth ETF
Last Close: 44.85
Net Assets ($M): 7596
Expense Ratio: 0.04%
Dividend Yield: 1.3%
5-Yr Average Dividend Yield Growth: 10.5%
YTD Returns Vs S&P500: 10.6%
2-yr Annualized Returns Vs S&P500: 5.2%
3-yr Annualized Returns Vs S&P500: 5.7%
5-yr Annualized Returns Vs S&P500: 3.8%
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Ticker: FDIS
Name: Fidelity MSCI Consumer Discretionary Index ETF
Last Close: 51.71
Net Assets ($M): 688
Expense Ratio: 0.08%
Dividend Yield: 1.2%
5-Yr Average Dividend Yield Growth: 13.8%
YTD Returns Vs S&P500: 10.5%
2-yr Annualized Returns Vs S&P500: 1.9%
3-yr Annualized Returns Vs S&P500: 3.9%
5-yr Annualized Returns Vs S&P500: 1.7%
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Ticker: FTEC
Name: Fidelity MSCI Information Technology Index ETF
Last Close: 81.06
Net Assets ($M): 3745
Expense Ratio: 0.08%
Dividend Yield: 1.4%
5-Yr Average Dividend Yield Growth: 23.0%
YTD Returns Vs S&P500: 15.0%
2-yr Annualized Returns Vs S&P500: 12.0%
3-yr Annualized Returns Vs S&P500: 14.1%
5-yr Annualized Returns Vs S&P500: 10.7%
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Ticker: SCHG
Name: Schwab U.S. Large-Cap Growth ETF
Last Close: 101.1
Net Assets ($M): 9831
Expense Ratio: 0.04%
Dividend Yield: 0.7%
5-Yr Average Dividend Yield Growth: 5.2%
YTD Returns Vs S&P500: 12.1%
2-yr Annualized Returns Vs S&P500: 7.3%
3-yr Annualized Returns Vs S&P500: 7.5%
5-yr Annualized Returns Vs S&P500: 4.0%
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Ticker: MGK
Name: Vanguard Mega Cap Growth Index Fund ETF Shares
Last Close: 162.36
Net Assets ($M): 7347
Expense Ratio: 0.07
Dividend Yield: 0.9%
5-Yr Average Dividend Yield Growth: 5.2%
YTD Returns Vs S&P500: 14.8%
2-yr Annualized Returns Vs S&P500: 8.6%
3-yr Annualized Returns Vs S&P500: 7.9%
5-yr Annualized Returns Vs S&P500: 5.0%
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Ticker: VOOG
Name: Vanguard S&P500 Growth Index Fund ETF Shares
Last Close: 186.68
Net Assets ($M): 3565
Expense Ratio: 0.10%
Dividend Yield: 1.2%
5-Yr Average Dividend Yield Growth: 1.5%
YTD Returns Vs S&P500: 10.5%
2-yr Annualized Returns Vs S&P500: 5.1%
3-yr Annualized Returns Vs S&P500: 5.7%
5-yr Annualized Returns Vs S&P500: 3.6%
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Ticker: VONG
Name: Vanguard Russell 1000 Growth Index Fund ETF Shares
Last Close: 196.53
Net Assets ($M): 7002
Expense Ratio: 0.08%
Dividend Yield: 1.0%
5-Yr Average Dividend Yield Growth: 7.3%
YTD Returns Vs S&P500: 12.2%
2-yr Annualized Returns Vs S&P500: 7.4%
3-yr Annualized Returns Vs S&P500: 7.9%
5-yr Annualized Returns Vs S&P500: 4.9%
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Ticker: EDV
Name: Vanguard Extended Duration Treasury Index Fund ETF Shares
Last Close: 163.82
Net Assets ($M): 3286
Expense Ratio: 0.07%
Dividend Yield: 2.1%
5-Yr Average Dividend Yield Growth: 2.3%
YTD Returns Vs S&P500: 30.8%
2-yr Annualized Returns Vs S&P500: 16.5%
3-yr Annualized Returns Vs S&P500: 4.2%
5-yr Annualized Returns Vs S&P500: 2.1%
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Long
Long
Short SPYG after five waves upThis 60m chart of SPYG is almost identical to the chart of QQQ I posted earlier today. SPYG, or SPY Growth stocks, have been driving the recent move higher in the S&P, with SPYV (Value stocks) lagging the move. I'm counting what appears to be a five wave move nearing completion after breaking out of triangle consolidation. Looking for the index to form a near-term top and roll over. Initiating a short position at 36.00 with a profit target at 34.75.
Short