Platinum members who have read and studied The Feynman Study will find the following data of interest. Included in the ranking table is a list of ETFs we use to construct ITA portfolios. As mentioned many times, SDS is included in the list as the “investment canary” in that it provides a clue to market direction. If SDS has a high momentum percentage, the market is moving down.
ETF Rankings: The strength of the U.S. Equities market is born out by the fact that all “Big Six” equity ETFs rank above the SHY cutoff ETF. One international ETF, VEA, cracked the “above SHY” list and it has a strong relative momentum percentage. I’ve chosen to include VEA as it does not contain the emerging market stocks as does VEU. With emerging markets in a funk, the performance difference between VEU and VEA is significant. It is encouraging to see emerging markets (VWO) beginning to show signs of life with a strong momentum percentage. Nevertheless, it continues to be a poor performer overall.
Percent Shares For Momentum Investors: The following table shows how one might tailor a portfolio by skewing the assets toward the better performing ETFs. Another option, but a little more complicated, is to not only focus on the top performing ETFs, but to invest a higher percentage in the top momentum performers. In other words, down play VTV and invest a higher percentage in VEA, VBK, and VOT. My inclination is to focus on the top performing ETFs that also demonstrate the highest momentum percentage.