The Top 20 ETF Melt Up Candidates For Year End

It’s that time of year for holiday music, colder weather and the odd investing phenomenon known as window dressing to take place. For some reason, some money managers begin to purchase the best performing securities of the year towards the end of the year causing these top performers to melt upward in price. This historic trend, dubbed window dressing, is supposed to occur because money managers know that investors review the holdings in their portfolios at year end and compare them to the best performing securities in the marketplace that year. Presumably money managers want to demonstrate they owned the best performers — even if only for a short time. Thus they “dress” their portfolio before the year end portfolio snapshot (window) takes place. Yes Virginia, we live in an odd investment world…

I thought it would be interesting to take a look at the top 20 ETF/ETN melt up candidates this year. Doing so may provide a way to gauge the melt up affect on ETPs (exchange traded portfolios) and even yield a few investment ideas. After the break, I’ve compiled the latest year to date ETP performance report from Index, which I believe has the cleanest ETP data in the industry. This report includes all ETPs, except leveraged and inverse products, and is sorted by year to date performance. Click through the break to view the performance chart and associated observations… Continue Reading

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California vs. Corporations: Who’s Outperforming?

Despite the headlines, California paper has handily outperformed the S&P 500! Hard to believe but a six month look back at the iShares California AMT Free Muni ETF (CMF) versus the S&P 500 ETF (SPY) clearly shows that this debt ridden state led by the Governator, has been a better place to invest your money.

With about eight percent outperformance and much less volatility, California municipal bonds have had a great six month run versus the S&P 500. Granted this is a short period of time, but it highlights two key themes moving markets: “too big to fail” and the fear surrounding equities. Continue Reading

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