RRG Charts

January 2015

RRG Charts

Utilities leading the (relative) way

by Julius de Kempenaer

The Relative Rotation Graph below holds the nine S&P sector ETFs showing the weekly relative trends against the S&P 500 (SPY) and against each other. As you can see it is pretty crowded in the top-right, leading quadrant and a lot less so in the opposite lagging quadrant. In there we only see Energy (XLE) and Materials (XLB). Especially XLE is very far away from the benchmark and distorts the picture. But then again it is exactly what is happening. It also confirms a takeaway from research that I did years ago. While researching the performance and the Read More 

RRG Charts

Long Real Estate and Short Commodities .... End of Story

by Julius de Kempenaer

The relative rotation of various asset classes continues to tell the same story as it has been doing for quite a while now. I could make this a very short article by just saying that the short version of this party line remains to be long or overweight real estate (listed stocks) and short or underweight commodities. Such a view is backed by- and shown on the Relative Rotation Graph below, the chart holds a number of asset class ETFs and uses Vanguard Balanced Index Fund (VBINX) as its benchmark. But there is more to see than just Real Estate and Commodities. Read More 

RRG Charts

Are US stocks losing their edge?

by Julius de Kempenaer

In my first article of this year I talked about more developed markets improving versus Emerging Markets. In the past few weeks however I have been monitoring rotation in international equity markets with interest as I think we are at cross-roads with regard to some relationships in this universe. Obviously the relationship between the US and Europe is monitored by a lot of investors and pretty much all of 2014 that was a pretty boring thing to do. The US was leading Europe, and a lot of other parts of the world, and that was it, full stop.. But maybe not any more? Read More 

RRG Charts

No Mickey Mouse rally for DIS

by Julius de Kempenaer

Below is the Relative Rotation Graph holding the 30 stocks that make up the Dow Jones Industrials index. When I start analysing a universe like this I always start to look at what's going on on the outskirts of the RRG. In this case they are the names inside the shaded areas. Green on the positive side and Red on the negative side. These are the stocks that are in a mature relative up- or down-trend against the Industrials index. Basically the stuff that you want to hold in your portfolio already and the stuff that you should have gotten rid of a while ago. If you want, you can Read More 

RRG Charts

Swap Emerging Markets for something more developed

by Julius de Kempenaer

It's time to check the world again. The Relative Rotation Graph below shows the relative positions and movement of international equity markets against the FTSE All World index. Please note that I am using $ ticker symbols for the actual indices and not the ETFs to avoid the currency effect of the US dollar strength to distort the picture. And swoooosh there goes China. The $FTX (FTSE / Xinhua A50 Index) really shot through the roof over the past few weeks. The tail is almost straight and at a 45 degree angle, meaning it is still gaining on both the JdK RS-Ratio and the JdK RS-Momentum Read More