Sabtu, 19 Juli 2008

Australian ETF Better Than Most

by S.C.R. Analysts

Finance Research & Analysis for July 13, 2008

The following excerpts are from interesting observations made during recent financial research revisions:

Excerpt 1: D4 (International) Portfolio Research & Analysis SPDR S&P 500 (SPY) vs. SPDR S&P World ex-U.S. (GWL): (1) Observation: While GWL also has a negative price path, it is not as great as the one for SPY. (2) Implication: This is mildly bullish for SPDR S&P World ex-U.S. by the implication that monies are not flowing as fast out of international equities. [Charts: D4-1 (relative strength); A4-1A (regression); A4-1B (price performance)]

Excerpt 3: D4 (International) Portfolio Research & Analysis iShares MSCI Australia Index (EWA) vs. iShares S&P Global 100 with U.S. (IOO): (1) Observation: While suffering a similar fate, EWA has a negative price path with weak indicators. (2) Implication: This has bullish implications for Australia in that it indicates that monies are not flowing out of Australian based securities as fast as the average negative global money flows. To see this, compare the weak indicators for Australia to the strong indicators for France. The MSCI France Index (EWQ) also has a steeper negative slope, which also indicates greater money flows exiting the French securities. [Charts: D4-10 (relative strength); A4-6A (regression); A4-6B (price performance)]

For most investors, a diversified portfolio approach combining stocks, bonds, money market securities, etc., is optimal. While diversification cannot protect against a loss from a declining market, it can reduce the overall portfolio's volatility.

Finally, to the above analysis, the usual disclaimers apply. Since all Strategic Capital Research publications provide research that is conducted using historical data, a reminder needs to be made that the analysis of past market reactions cannot predict future market actions. In particular, no amount of historical data can predict the sudden changes that occasionally occur in financial markets.

About the Author

The SCR Analysts represent the collective voice of the researchers at Strategic Capital Research (SCR). We provide global financial analyses, and subsequent strategies, from countries to companies. Copyright 2007-2008.

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