4-Year Outperformance by the
Top 10 Exchange Traded Funds

Weekly Rankings of Major Trend Relative Strength

My weekly Top 10 ETFs ranked by the Major Trend Relative Strength outperformed the S&P 500 by 113 percentage points since August, 2004, in simulation. Click here for a graph of simulated performance.

To arrive at my Top 10 ETF picks, I first calculate a six-month rate of change (approximately) of price. Next, I add in filters to dampen random noise. I rank all the ETFs in my universe from highest rate of change to lowest rate of change. Finally, I pick the highest 10 ETFs each week. These Top 10 are the best performing ETFs, the ones with the best major trend momentum.

Please note that this is a high-volatility strategy: the stocks that go up the most when the stock market is in a Bullish trend often go down the most during market corrections to the downside.

Changes to this research study as of 3/12/10: In an effort to improve this study, I have deleted short and leveraged ETFs, because they have delivered unfavorable “tracking error” in simulated real-time performance. In other words, they have failed to accurately mirror the performance of the indexes they are intended to track, over periods measured in multiple weeks and months. Therefore, I have concluded that they appear to be unsuitable for holding periods measured in weeks, making them incompatible with the design of this research study.

In addition, I have deleted coverage of relatively inactive ETFs that trade fewer than 90,000 shares a day. And I have added a few active foreign and bond ETFs in order to broaden diversification.

Please note that this Top 10 list is a research study and is not investment advice. Your use of this site means that you have read, understood, and accepted my Disclaimer.

Weekly Rank, Name, Symbol

99 Value SmallCap S&P 600, RZV
99 Indonesia MV, IDX
98 Turkey MSCI iS, TUR
97 Semiconductor SPDR, XSD
96 Russia MV, RSX
96 Consumer Discretionary SPDR, XLY
95 Growth SmallCap VIPERs, VBK
94 Semiconductor iS GS, IGW
94 Small Cap VIPERs, VB
93 Value SmallCap VIPERS, VBR
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Based on prices as of the close on Friday, April 16, 2010.

Exchange Traded Funds
Weekly Rankings of Major Trend Relative Strength

Each week, at the end of the week, I rank 138 Exchange Traded Funds (ETFs), based on my updated version of the Screening Method for Analysis of Relative Strength. For details on this method, see my book, pages 604-609. Below, I ranked 138 ETFs as of the posting date, above.

Research studies suggest that ETFs ranked in the top decile (highest tenth) of the list (with a rank of 90 and higher) may have a greater probability of outperforming the market in the months ahead.

Interpretation:
100 to 90, Buy
89 to 70, Hold
69 to 50, Neutral, Market Perform
49 to 30, Avoid
29 to 0, Sell

Please note that this screen is not investment advice. Your use of this site means that you have read, understood, and accepted my Disclaimer.

Weekly Rank, Name, Symbol

99 Value SmallCap S&P 600, RZV
99 Indonesia MV, IDX
98 Turkey MSCI iS, TUR
97 Semiconductor SPDR, XSD
96 Russia MV, RSX
96 Consumer Discretionary SPDR, XLY
95 Growth SmallCap VIPERs, VBK
94 Semiconductor iS GS, IGW
94 Small Cap VIPERs, VB
93 Value SmallCap VIPERS, VBR
92 Microcap Russell, IWC
91 Metals & Mining SPDR, XME
91 Value SmallCap Russell 2000, IWN
90 Value SmallCap S&P 600 B, IJS
89 SmallCap S&P 600, IJR
89 SmallCap Russell 2000, IWM
88 Growth MidCap 400 B, IJK
87 Transportation Av DJ, IYT
86 Growth BARRA Small Cap 600, IJT
86 MidCap S&P 400 iS, IJH
85 MidCap S&P 400 SPDRs, MDY
84 Growth SmallCap R 2000, IWO
84 Mexico Index, EWW
83 Homebuilders SPDR, XHB
82 Industrial SPDR, XLI
81 Value MidCap S&P 400 B, IJJ
81 Value MidCap Russell, IWS
80 Networking, IGN
79 Growth LargeCap NASDAQ 100, QQQQ
79 South Korea Index, EWY
78 MidCap Russell, IWR
77 Info Tech VIPERs, VGT
76 Growth MidCap Russell, IWP
76 LargeCap Blend S&P=Weight R, RSP
75 Technology DJ US, IYW
74 REIT VIPERs, VNQ
74 REIT Wilshire, RWR
73 Sweden Index, EWD
72 Malaysia Index, EWM
71 India Earnings WTree, EPI
71 Basic Materials DJ US, IYM
70 Real Estate US DJ, IYR
69 Realty Cohen & Steers, ICF
69 Australia Index, EWA
68 Singapore Index, EWS
67 Pacific ex-Japan, EPP
66 Technology SPDR, XLK
66 Latin Am 40, ILF
65 Financials VIPERs, VFH
64 South Africa Index, EZA
64 Growth VIPERs, VUG
63 Emerging VIPERs, VWO
62 Blend Total Market VIPERs, VTI
61 LargeCap Blend Russell 3000, IWV
61 Financial DJ US, IYF
60 Biotech SPDR, XBI
59 Financial Services DJ, IYG
59 Canada Index, EWC
58 India PS, PIN
57 Growth 1000 Russell, IWF
56 Emerging Markets, EEM
56 LargeCap 1000 R, IWB
55 Thailand MSCI iS, THD
54 Dividend SPDR, SDY
54 LargeCap VIPERs, VV
53 Value 1000 Russell, IWD
52 Brazil Index, EWZ
51 Value LargeCap Dynamic PS, PWV
51 Financial SPDR, XLF
50 Small Cap EAFE MSCI iS, SCZ
49 Value S&P 500 B, IVE
49 S&P 500 SPDRs LargeCap Blend, SPY
48 S&P 500 iS LargeCap Blend, IVV
47 Growth S&P 500/BARRA, IVW
46 Materials SPDR, XLB
46 China LargeCap Growth G D H USX PS, PGJ
45 Chile MSCI iS, ECH
44 DIAMONDS (DJIA), DIA
44 Value VIPERs, VTV
43 Dividend High Yield Equity PS, PEY
42 Silver Trust iS, SLV
41 Emerging 50 BLDRS, ADRE
41 Water Resources, PHO
40 LargeCap Blend S&P 100, OEF
39 Dividend Appreciation Vipers, VIG
39 Dividend DJ Select, DVY
38 Switzerland Index, EWL
37 Taiwan Index, EWT
36 Financial Preferred, PGF
36 Preferred Stock iS, PFF
35 Gold Shares S.T., GLD
34 Natural Resource iS GS, IGE
34 Global ex US ACWI iS, ACWX
33 Hong Kong Index, EWH
32 Dividend International, PID
31 Pacific VIPERs, VPL
31 United Kingdom Index, EWU
30 Netherlands Index, EWN
29 Telecom DJ US, IYZ
29 Consumer Staples SPDR, XLP
28 Growth EAFE MSCI, EFG
27 Energy VIPERs, VDE
26 Global 100, IOO
26 Capital Markets KWB ST, KCE
25 Energy SPDR, XLE
24 EAFE Index, EFA
24 Value EAFE MSCI, EFV
23 Austria Index, EWO
22 Health Care SPDR, XLV
21 Bond EmrgMkt JPM iS, EMB
21 Japan Index, EWJ
20 Energy DJ, IYE
19 Energy Global, IXC
19 China 25 iS, FXI
18 Bond, High-Yield Junk, JNK
17 Belgium Index, EWK
16 Europe 350 S&P Index, IEV
16 Germany Index, EWG
15 Bond, High-Yield Corporate, HYG
14 European VIPERs, VGK
14 France Index, EWQ
13 Bond, Corp, LQD
12 EMU Europe Index, EZU
11 Commodity Tracking, DBC
11 Bond, TIPS, TIP
10 Utilities VIPERs, VPU
9 Oil, Crude, U.S. Oil Fund, USO
9 Bond Muni ATM-Free S&P iS, MUB
8 Bond, Aggregate, AGG
7 Utilities SPDR, XLU
6 Bond Treasury Short-Term iS, SHV
6 Bond, 1-3 Year Treasury, SHY
5 Bond Ex-US Treas, BWX
4 Bond, 10 Year Treasury, IEF
4 Italy Index, EWI
3 Spain Index, EWP
2 WilderHill Clean Energy PS, PBW
1 Bond, 20+ Years Treasury, TLT
1 Agriculture DB PS, DBA