Vermilion ETF Pathfinder: Actionable ETF research & Ideas
YTD S&P 500 trading range continues; Avoid broad international exposureConstructive but murky outlook for U.S. equities paints an overall mixed picture, making sector/group/stock selection critical.
• Bull case: (1) advance-decline (A-D) lines and other breadth indicators (% of stocks above 50-, 200-day moving averages) are neutral to positive; (2) price and RS uptrends remain intact for risk-on segments, including Technology (XLK), biotech (XBI, IBB), and growth stocks (IUSG); and (3) the S&P 500 is trading within a 4-month uptrend.
• Bear case: (1) uptrends are breaking down for cap- and equal-weighted Discretionary vs. Staples ratios; (2) RS is bottoming for defensive segments, including Utilities (XLU), Staples (XLP), Real Estate (XLRE, VNQ), and pharma (PJP, XPH); (3) the S&P 500 remains below the January highs and is trading in a broad sideways range; and (4) broad EM (EEM) and developed international (EFA) markets have broken down and remain in downtrends, dampening overall risk sentiment.
Vermilion Research delivers timely, actionable, and unique research inputs to professional investors. Our research strategists highlight securities which we believe are at major inflection points, based on our various proprietary technical indicators, and offer asymmetric risk/return profiles. We believe our research methodology, which is not limited by industry sector or market capitalization, enables us to deliver superior investment recommendations.
Our process begins by organizing all actively traded stocks into coherent sectors, then into logical industry groups. We then apply our proprietary relative strength tools to identify developing price trends. Once attractive trends are identified within a selected sectors or groups, we screen for individual stocks which we believe offer the best risk/reward profile. Vermilion offers U.S. and global equity market research products. Vermilion’s research team, which has received numerous awards and accolades, has a combined 70 year of experience in the analysis of investment securities.
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