Is it time to rebalance your portfolio?
We have updated the global Indices for Rieki & Jiseki readings. The VIX Futures (iPath S&P 500 VIX Short-Term Futures ETN) is the worst performer along with Short ETFs on S&P 500, DOW (DXD) and Nasdaq 100. The performance of VIX and Short ETF’s is correlated as both Volatility indicators and short ETFs should fall as the markets rises. The other global indices that are reeling under poor performance are Brazilian BVSP and Japanese Nikkei.
On the top performing side we have the Agricultural Equity Index (MOOO.L), CBOE Technology Index (TXX). Well technology has been a global top performer. CNXIT Indian Technology sector index is also a top performer, different settings but similar timing.
Regarding other major indices…barring S&P500 the DOW Industrials, Dow Utilities, and Dow composite continue to witness falling Rieki performance cycles. S&P 500 continued positivity case is confirmed by performance positivity on Russell broad based indices, which are also positive on Rieki. A broad market index may never reach the top of the performance rankings among a group of assets owing to the large number of components. Large number of components smoothen returns. And at any intermediate top we can expect blue chip weakness before the broad market underperforms. A bigger ship takes more time to turn.
This analogy of bigger ship and smaller ship also confirms that indicators don’t suggest that we have a real primary multiyear case of weakness yet. What at best the indicators tell us is that there will be a rise in volatility, an intermediate multi week weakness where top ranking Technology, Material and Agro sectors pause and underperform the rest of the market. Reading into the news is a hard task but beyond Steve Jobs and Eric Schmidt might just be an indication that it is time to rebalance portfolios.
Naked and/or pair strategies are not riskless strategies. Time arbitrage portfolio legs should be risk weighted before any implementation. Please mail us for a detailed working or consult a local financial risk manager to execute these pairs. For more details please subscribe to the Orpheus Research.
On the top performing side we have the Agricultural Equity Index (MOOO.L), CBOE Technology Index (TXX). Well technology has been a global top performer. CNXIT Indian Technology sector index is also a top performer, different settings but similar timing.
Regarding other major indices…barring S&P500 the DOW Industrials, Dow Utilities, and Dow composite continue to witness falling Rieki performance cycles. S&P 500 continued positivity case is confirmed by performance positivity on Russell broad based indices, which are also positive on Rieki. A broad market index may never reach the top of the performance rankings among a group of assets owing to the large number of components. Large number of components smoothen returns. And at any intermediate top we can expect blue chip weakness before the broad market underperforms. A bigger ship takes more time to turn.
This analogy of bigger ship and smaller ship also confirms that indicators don’t suggest that we have a real primary multiyear case of weakness yet. What at best the indicators tell us is that there will be a rise in volatility, an intermediate multi week weakness where top ranking Technology, Material and Agro sectors pause and underperform the rest of the market. Reading into the news is a hard task but beyond Steve Jobs and Eric Schmidt might just be an indication that it is time to rebalance portfolios.
Naked and/or pair strategies are not riskless strategies. Time arbitrage portfolio legs should be risk weighted before any implementation. Please mail us for a detailed working or consult a local financial risk manager to execute these pairs. For more details please subscribe to the Orpheus Research.