Reminder: Sabrient is available to chat with Members, comments are found below each post.
Courtesy of Scott Martindale, Senior Managing Director, Sabrient
Last week, the stock market gave us epic swings. Bears came out with predictions of global economic meltdown as the market tanked, and then bulls came out trumpeting once-in-a-generation valuations when the market bounced. But, in both directions, the combination of bargain-hunting/short-covering to the upside and capital-preservation/short-selling to the downside led to tremendous momentum that shocked even the most jaded of long-time “I’ve seen it all” market observers. If last week showed us anything it is how quickly modern electronic trading can move the market in momentum fashion—up or down.
Today (Wednesday), Technology started out pretty strong but ended up weak, as Dell (DELL) cast a big pall over the sector. Despite a moderating of the extreme volatility, the VIX is still relatively high, and the Financial sector has been at the forefront. Financials were moderately strong today, but the sector led to the downside on Tuesday and to the upside on Monday. And although Sabrient’s SectorCast indicates that the Financial sector ranks the highest on a forward-looking basis, many of the large bank stocks are rated “very aggressive” in their accounting and governance practices, which makes them relatively risky as individual investments. Few carry Buy ratings in the Sabrient Ratings Algorithm.
Investors continue to find some solace in the diversification and ease of trading offered by exchange-traded funds (ETFs). BlackRock reported that the ETF industry in the United States had 1,039 ETFs and assets of $973 billion from 29 providers, as of June 30, 2011. This compares to 846 ETFs and assets of $693 billion from 30 providers one year ago. New exchange-traded funds (ETFs) continue to be filed and launched, with many of them “actively traded” as opposed to passively tracking an index. Still, passively indexed ETFs dominate, and they include those that track “active quant” indexes like Sabrient’s. In fact, Direxion Funds has announced an assortment of ETFs, including two that will track new Sabrient indexes: http://bit.ly/oHNYFr
There is a lot happening in the news these days. Google (GOOG) gave the market a boost when it agreed to purchase Motorola Mobility (MMI) at a huge premium. The purchase will give Google a slate of 17,500 patents and another 7,500 patent applications. Apparently the licensing of tech patents has become…
