LATEST FEATURE ARTICLE:

Better Sector Rotation Performance

August 19, 2017

The founder of SumGrowth Strategies explains how to use his SectorSurfer service to build a sector rotation strategy that is optimized for both bull and bear markets.

Sector rotation, as an investment strategy, is rooted in the economic cycle data produced by the National Bureau of Economic Research (NBER) dating back to 1854. However, achieving satisfactory sector rotation investment performance has long been difficult or elusive. For example, Figure 1 illustrates how a sector rotation strategy employing the original nine Select Sector SPDR ETFs (exchange-traded funds) and a popular momentum algorithm (purple line, detailed later) barely outperforms a simple equal-weight portfolio of the same ETFs (red line). This article shows how performance similar to that of the “Desired Sector Rotation Strategy” (light blue line in Figure 1) can be achieved by utilizing advanced signal processing methods and employing problem segmentation to treat bull and bear markets as separate problems.

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Buying a Computer

Trends in the computing industry and issues to consider before purchasing a new computer or upgrading your current system.

ETFs

Analyzing, selecting and trading exchange-traded funds

Investor Sentiment

Using investor sentiment to indentify tops and bottoms in the market.

Market Breadth & Timing

Market breadth and momentum indicators to gauge the market's overall direction.

Mutual Fund Screening & Analysis

Screening for and analyzing mutual funds.

Online Discount Brokers

In-depth reviews of online discount brokers and their tools, features and flaws.

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Constructing a portfolio of investments and the issues involved, including risk management.

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In-depth reviews of some of the most popular investment-related software.

Stock Screening & Analysis

How to filter for prospective stocks, plus techniques and resources for analyzing individual stocks.

Stock Valuation

Determining the "true worth" of a company.

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Using technical indicators and charts to help time your buy and sell decisions.

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Using computerized tools and resources to prepare and file your personal income taxes.

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