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Invesco S&P 500 Equal Weight ETFInvesco S&P 500 Equal Weight ETFInvesco S&P 500 Equal Weight ETF

Invesco S&P 500 Equal Weight ETF

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RSP trade ideas

Quarterly rotation out of Tech and into Small-Mid cap stocks. Equally weighted S&P 500 (RSP) and IWM had the smallest decline Thursday and Friday compared to other indices. This could signify that the sell-off was mostly over valued tech stocks and not a broader market sell off. Compare this to the price action in June, where RSP and IWM fell significantly, indicating a broad sell off of the S&P 500. Using this chart, I measured the distance between the Nasdaq and the S&P 500 on June 10, just before the sell off. We can see that there is a 13% variance between the two indices. Compare this to August 12th variance of 21%. Considering that the RSP had a significant decline, we can conclude that there was a broad sell off of small-mid cap stocks and that money was then invested in large cap tech stocks (FANG). Both of these declines happened in a two-day period but there is a big difference between the percentage lost. If you add up all of the declines in each of the indices, we see total loss for June 10 to be 31.4%. This is much less than that of August 12, which declined only 17.6%. What is most interesting is when we look at the weighted average of these declines. It is almost exactly inverse! Meaning that in June the Nasdaq decreased the least but in August it decreased the most. The same is true with the Russell decreasing the most in June but the least in August. I believe that going forward we will see greater percentage gains in IWM compared to the other indices. However, all of this is speculative and subject to change. But if you follow the wave counts for the S&P 500 and Dow you know we need a significant push to complete wave 5. A further decline in these indices would invalidate the wave count and cause significant bearish momentum. In conclusion, assuming that this recent move was due to rotation I am bullish SPY and IWM and neutral QQQ. We should still see gains in tech but not as much as small to mid cap stocks. To confirm this analysis, I will assess the weekly gains of each index over the next several weeks. If we do not see an increase in small-mid cap stocks then money is leaving the markets and not being reinvested. This would be very bearish.
AMEX:RSPLong
by Harry_Hood
5
!RSP (Equally Weighted) SP500 Bearish Bias RemainsBy looking at an equally weighted index of the SP500, something becomes a little more obvious. Could there be a divergence among the top say,--30 companies? If so, what would a divergence mean when you see other divergences such as the European/ Asia-pacific divergence that netted us healthy profits across 6 different inicies and economies? Keep in mind 3,046 is the trendline for the SP500 (SPX). Keeping an eye on this index will allow us to monitor any continuation in divergences or convergences. 01:55:37 (UTC) Wed May 27, 2020
AMEX:RSPShort
by TayFx
6
INVESTING STRATEGIES IN THE GigEconomy: VALUE-RSP & MOMENTUM-SPYShort and well-detailed idea on Value vs Momentum investing? ; Series on investing- Dec 28th, 2019 What's the Equal-value weighted(RSP) vs Market-cap weighted, top heavy(SPY) ratio useful for? - Simply for discussing how two of the most well known investment strategies have performed in the recent years. There's many books written on this topic, but I will try to keep this post as short as possible. 1. First things first, here's the whole chart. As expected, in downturns, large caps should perform outperform small caps, simply because of the lower risk. People tend to park their money in safe well-diversified stocks, when the systematic risks become too high. Vice-versa, in normal cycles and economic expansions, due to the higher betas, small caps outperform large caps. This was understandable for the short liquidity cycles in 2011-2012, and 2015-2016, which I discuss in my previous idea on liquidity cycles, But what about post 2016? There was a few rate hikes, but at the same time both fiscal and monetary expansion, that gave an above average GDP growth. Interestingly enough, the RSP/SPY ratio, almost has perfect correlation with the treasuries spread(yield curve, US10Y-US03M). Nonetheless, momentum strategy kept outperforming value investing. The question is why? 2. One of the answers is of course, the rise in the gig-economy and automation. Small business, even listed small caps, simply can't compete anymore . Whenever a company has a competitive edge(i.e instagram) it gets acquired by the time it becomes too threatening . Unfortunately, the end product of this trend, I would argue has been overall lower market competitiveness. The second answer to the same question, is because of the rise of ETF's and ETF investing . In simple terms, ETF's magnify momentum outcomes . Buy high, sell higher. Greater up-trends, but at the same time greater down-trends! 3. Will the momentum outperforming trend continue in the future? As this trend has been going on for few years, it's very hard to tell how far the gig-economy will expand. Lately, there's been support for the idea to break up big-tech, but this will just takeaway the competitive edge that the U.S economy has over the world. Nevertheless, history has shown consistently, that trends typically revert to their mean, and as we head into the next decade there's a high probability that value investing will once again perform well. To sum up this idea, with all said, I am taking the contrarian view. I think that we are entering into a speculative bubble. Obviously, things are looking quite well right now. Every-time, there's a minor chance of a market sell-off, the FED steps in with more liquidity. At last, the market will wake up at some point after the 2020 election (perhaps 2021-2022), and finally realize that there's no growth and no fundamentals supporting these high valuations (P/E consistently above historical average). This is my view on value and momentum investing. If you are interested in a discussion, simply write a comment or send me a private message. Thanks for the continuous support! -Step_ahead_ofthemarket- ________________________________________________________________________________________ >>I do not share my ideas for the likes or the views. This channel is only dedicated to well informed research and other noteworthy and interesting market stories.>> However, if you'd like to support me and get informed in the greatest of details, every thumbs up and follow is greatly appreciated! For reference, fundamental investing is doing even worse than value investing. Disclosure: This is just an opinion, you decide what to do with your own money. For any further references or use of my content- contact me through any of my social media channels.
AMEX:RSPLong
by step_ahead_ofthemarket
7
The preponderance of evidence: RSPThis is part of a series of charts which I will posting for the reader to make up his/her mind based on the weight of the evidence. Do note, these are weekly charts which means the implications of which will occur over the next 12, 18, 24, 36 months. I used RSP over the standard ES1! charts so as to eliminate the bias towards FANGs stocks in the general S&P500 index. Here you can see the weekly completion of a 3-drive pattern from the 2009 trough.
AMEX:RSP
by WellTrainedMonkey