I ran across this article with some advice for kids heading off to college. It’s equally useful for kids in their first couple of years at college. Have a read if you have a son or daughter that could benefit, if your friends have a son or daughter. Enjoy.
Ron’s Market Minute — Wet Blanket
I would pose that the character of the market appears to have changed. We’ve seen a higher high and a higher low, and by definition that is supposed to mean that the market has found a bottom and resumed an uptrend. That is, of course, good news. However, let’s look beneath the hood for a moment.
The following chart is a view of the leading sectors of the main Index (the S&P Index* as illustrated by the ETF ‘SPY.’ A reminder: about 80% by dollars weight of US stocks are represented by the SPY, so it’s a pretty good representation.
I’d like you to notice that this chart shows 3 of the 12 main sectors that make up the US Market Index.
The Red line is the consumer discretionary sector, Green line is the technology sector, Pink line represents the real estate sector, and finally, the Blue line shows the S&P Index. The time period on this chart is two months. Before that time, all sectors were heading down — note that these 3 sectors were all trending upward faster than the main index represented by the blue line. The rest of the 12 sectors (10 others) are currently under-performing the main index. Although the consumer discretionary and technology sectors are the two largest, it would look better if the rest of the sectors were not lagging the main index. Just a bit of a sign of caution- this is a ‘narrow’ market’ – one being led by just a few sectors.
Once (if) the market broadens out to include stronger performance from the rest of the sectors (or most of them), it will become a broader market, and thus a healthier market. So, while we’re all glad to see some up-trending numbers, let me add an additional wet blanket to your afternoon. This next chart shows the first 6 months of this year, printing daily price values of the S&P Index*.
Ronald P. Denk, CFP®
Investment Advisor
Denk Strategic Wealth Partners
10000 N. 31st Avenue, Suite D406A
Phoenix, AZ 85051
Phone (602) 252-8700
Fax (602) 252-8701
Toll-Free (877) The-Denk
www.denkinvest.com
LFS-4901564-081222
This weekly article reflects news, commentary, opinions, viewpoints, analyses, and other information developed by Denk Strategic Wealth Partners for use with advisory clients only and/or select but unaffiliated third parties. DSWP provides Market Information for illustrative and informational purposes only. If you wish to receive this weekly commentary by email, please contact us at 602-252-8700 or by e-mail at lindaw@denkinvest.com. If you are receiving this commentary via email and would prefer not to please let us know either by email or phone.
Ronald Denk is an Advisory Representative offering services through Denk Strategic Wealth Partners, A Registered Investment Advisor. He is also a Registered Representative, offering investments through Lincoln Financial Securities Corporation, Member FINRA/SIPC.
Denk Strategic Wealth Partners is not affiliated with Lincoln Financial Securities Corporation. Information in this commentary is the sole opinion of Denk Strategic Wealth Partners. Past performance is no guarantee of future returns. All market related investments involve various types of risk, which include but are not restricted to, credit risk, interest rate risk, volatility, going concern risk, and market risk.
The Update provides information of a general nature regarding legislative or other developments. None of the information contained herein is intended as legal advice or opinions relative to specific matters, facts, situations, or issues. Additional facts, information or future developments may affect the subjects addressed in this document. You should consult with an attorney, accountant or DSWP planner about your particular circumstances before acting on any of this information because it may not be applicable to your situation.
Lincoln Financial Securities and Denk Strategic Wealth Partners and their representatives do not offer tax advice. Please see your tax professional regarding your individual needs.
*The indices are representative of domestic markets and include the average performance of groups of widely held common stocks. Individuals cannot invest directly in any index and unlike investments, indices do not incur management fees, charges, or expenses, therefore specific index returns will be higher. Past performance is not indicative of future results.
Please see Denk Strategic Wealth Partners’ Client Relationship Summary here https://denkinvest.com/?page_id=7099 for succinct information about the relationships and services DSWP offers to retail investors, related fees and costs, specified conflicts of interest, standards of conduct, and disciplinary history, among other matters.
LFS’ Regulation Best Interest Disclosure Document, which describes LFS’ broker-dealer services, and other client disclosure documents can be found here <https://www.lfg.com/public/lincolnfinancialsecurities/clientinformation/overview/disclosure>.
Past performance is not a guarantee of future returns.
