that site Current Recommendations
|click now Model / Changes / Holdings||lantus cartridge price As of 12/23/16|
|Tactical Fixed Income
Most recent recommendation to buy on 12/12/16
Holdings: SJNK, SRLN, CWB, and ~40% Cash
|+0.4% wk||-0.0% since
|Global Multi-Asset Income
Most recent recommendation to buy on 12/12/16
Holdings: SJNK, PBP, SDY, SPHD, and MDIV
|+0.5% wk||-1.5% since
Most recent recommendation to buy on 12/5/16
Holdings: FTA, XSLV, DES, and ~1% Cash
|+0.5% wk||+1.9% since
Most recent new recommendations 12/19/16
Holdings: KRE, IYT, XES, and SOXX
|+0.8% wk||+11.1% ytd|
Sell Deutsche X-trackers Harvest CSI 300 China A-Shares (ASHR)
Buy ~19.1% iShares Currency Hedged MSCI EAFE (HEFA)
Holdings: DXJ, GREK, RSX, EWI, and HEFA
|-0.1% wk||-3.1% since
Note: New recommendations recorded at the closing price on the day recommendation is made. You may place trades as soon as you receive this update.
Winding Down 2016 with Strength in TIPS
Last week consisted of five days of below-average volume. This week will likely be four days of the same. However, low volume is not synonymous with a boring market. In fact, the reduced volume makes it easier for stocks to post larger swings as any step-up in buying or selling is harder to balance out with opposing pressure. Additionally, this being the last week of the year is also a time when many managers do their year-end “window dressing” by increasing exposure to winning stocks.
Telecom was the big winner last week, with its one-week gain of 3.0% being the best among the major categories we track. Latin America grabbed the second-best spot, and just to keep things interesting, Treasury Inflation-Protected Securities (“TIPS”) came in third. It is unusual to see inflation-protected bonds showing up as one of the best-performing investment categories. Maybe it’s because there hasn’t been any meaningful inflation since the invention of TIPS.
TIPS were first introduced in 1997, and the first TIPS ETF didn’t arrive until 2003. Inflation, as measured by the consumer price index (“CPI”), has run about 2.1% since that time. In mid-2008, the CPI was registering a 12-month increase of 5.6%, and the iShares TIPS Bond ETF (TIP) gained 15%, which was about 2.3% better than the iShares 7-10 year Treasury ETF (IEF). Since then, the CPI has averaged only 1.1% a year, and TIP has underperformed IEF (2.9% annualized versus 4.6%). Expectations of inflation were on the rise last week, but there are no signs of a sustained increase in the CPI yet.
The MSCI EAFE Index is the most widely followed benchmark for international developed stock markets, which excludes the U.S., Canada, and emerging markets. Its primary tracking ETF is the iShares MSCI EAFE (EFA), which was launched in 2001. Today, the International Rotation model will be adding an alternate exposure to this benchmark with the purchase of the iShares Currency Hedged MSCI EAFE ETF (HEFA). Launched in 2014, HEFA is a fund-of-funds, which means the majority of its assets are in other ETFs. In this case, 98% of its holdings are in EFA, the ETF representing the traditional unhedged version of the benchmark. The other 2% of its assets hold various currency forwards to eliminate currency fluctuation impacts. When the U.S. dollar is moving higher against other currencies, as it is now, then HEFA should outperform EFA.
Markets will be closed next Monday in observance of the New Year’s Day holiday. Therefore, our next scheduled update is set for Tuesday, January 3, 2017.
The Tactical Fixed Income model advanced 0.4% for the week and is flat since its inception on 9/30/16. For the week, SPDR Barclays Convertible Securities (CWB) gained 1.2%, SPDR Barclays Short Term High Yield Bond (SJNK) added 0.7%, and SPDR Blackstone/GSO Senior Loan (SRLN) increased 0.2%.
The Global Multi-Asset Income model gained 0.5% for the week, and it is down 1.5% since its inception on 9/30/16. First Trust Multi-Asset Diversified Income (MDIV) went ex-dividend at $0.1047 per share. Weekly returns consisted of First Trust Multi-Asset Diversified Income (MDIV) +1.0%, SPDR Barclays Short Term High Yield Bond (SJNK) +0.7%, PowerShares S&P 500 High Dividend Low Volatility (SPHD) +0.4%, SPDR S&P Dividend (SDY) +0.4%, and PowerShares S&P 500 BuyWrite (PBP) -0.1%.
The Factor Rotation model increased 0.5% for the week, and it is up 1.9% since its inception on 9/30/16. WisdomTree Small Cap Dividend (DES) went ex-dividend at $0.24923 per share, and First Trust Large Cap Value AlphaDEX (FTA) will pay $0.211. For the week, PowerShares S&P SmallCap Low Volatility (XSLV) added 0.8%, WisdomTree Small Cap Dividend (DES) rose 0.4%, and First Trust Large Cap Value AlphaDEX (FTA) gained 0.3%.
The Sector Rotation model grew 0.8% for the week and is up 11.1% year to date. Last week, the model sold First Trust NYSE Arca Biotechnology (FBT) and used the proceeds to initiate a 17.9% position in iShares PHLX Semiconductor (SOXX), which has gained 1.9% since then. The iShares Transportation Average ETF (IYT) went ex-dividend at $0.361677 per share, and iShares PHLX Semiconductor (SOXX) will pay $0.289869. For the week, SPDR S&P Regional Banking (KRE) gained 2.5%, iShares Transportation Average (IYT) added 0.1%, and SPDR S&P Oil & Gas Equipment & Services (XES) slipped 0.3%.
The International Rotation model declined 0.1% for the week, and it is down 3.1% since its inception on 9/30/16. Today, the model will sell Deutsche X-trackers Harvest CSI 300 China A-Shares (ASHR) and use the proceeds and available cash to create about a 19.1% position in iShares Currency Hedged MSCI EAFE (HEFA). Positions going ex-dividend included Deutsche X-trackers Harvest CSI 300 China A-Shares (ASHR) at $0.17143 per share, WisdomTree Japan Hedged Equity (DXJ) $0.49557, iShares MSCI Italy Capped (EWI) $0.221084, and VanEck Vectors Russia (RSX) $0.334. Returns for current holdings were MSCI Italy Capped (EWI) +2.0%, WisdomTree Japan Hedged Equity (DXJ) +0.1%, iShares Global X MSCI Greece (GREK) -0.5%, VanEck Vectors Russia (RSX) -0.8%, and Deutsche X-trackers Harvest CSI 300 China A-Shares (ASHR) -1.1%.
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