ETFs/Mutual Funds On The Cutline – Updated Through 08/29/2014

Below are the latest ETF Cutline reports, which show how far above or below their respective long-term trend lines (39 week SMA) my currently tracked ETFs/MFs are positioned.

The first report covers the ETF Master List from Thursday’s StatSheet and includes 398 ETFs, of which currently 354 (last week 344) are hovering in bullish territory.

The second report includes only High Volume ETFs. To clarify, High Volume (HV) ETFs are defined as those with an average daily volume of $10 million or higher.

These ETFs are generated from my selected list of some 97 that I use in my advisor practice. It cuts out the “noise,” which simply means it eliminates those ETFs that I would never buy because of their volume limitations. 75 ETFs (last week 73) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 797 (last week 776) above the line and 83 below it out of the 850 that I follow.

Take a look:

1. ETF Master Cutline Report     

2. ETF High Volume Cutline Report

3. MF Cutline Report

In case you are not familiar with some of the terminology used in the reports, please read the Glossary of Terms.

If you missed the original post about the Cutline approach, you can read it here.

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One Man’s Opinion: Will the European Central Banks Initiate QE?

92835431Latest data from he European Union showed annual inflation rate in the euro-zone slowed further to 0.3 percent in July from 0.4 percent in the prior month. A combination of two factors –low import prices, which is a legacy of a stronger euro, and low food prices are pushing the euro-area into the low inflation regime, said Paul Donovan, Managing Director of Global Economics at UBS AG. However, at this point there is a low inflation problem in the eurozone, but not an outright deflation problem, he noted.

Asked if the low inflation problem compounded the low-growth problem as well, Paul said when low-growth combines with low inflation, the outcome is a toxic “low nominal gross domestic product.” That’s a problem because when it comes to the government’s fiscal deficits and debt management, the nominal GDP (sum of real GDP and inflation rate) matters, he explained.

Asked to suggest policy solutions, Paul said politicians need to get their act together. That means initiating structural reforms of the labor market and a “proper” banking union, not a half-hearted effort that is being witnessed currently.


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New ETFs On The Block: Compass EMP US Discovery 500 Enhanced Volatility Weighted Index ETF (CSF)

93533368Compass Efficient Model Portfolio Funds, the Tennessee-based registered investment advisor and fund issuer, introduced its fourth Smart-Beta exchange-traded fund on the NASDAQ following the firm’s debut in the ETF segment last month.

The newly launched Compass EMP US Discovery 500 Enhanced Volatility Weighted Index ETF (CSF) seeks exposure in US small-cap stocks while giving protection against downside risks. CSF tracks the in-house developed CEMP US Small Cap 500 Long/Cash Volatility Weighted Index, which in turn is based on the CEMP US Small Cap 500 Volatility Weighted Index, a volatility-weighted benchmark of publicly-traded US stocks with market capitalizations below $3 billion.

The CEMP US Small Cap 500 Long/Cash Volatility Weighted Index, unlike the parent index, additionally includes an innovative mechanism which allows it to slash equity holdings by 75 percent through increased cash holdings during bear markets.


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ETF/No Load Fund Tracker Newsletter For August 29, 2014

ETF/No Load Fund Tracker StatSheet




Market Commentary

Friday, August 29, 2014


Fri pic

[Chart courtesy of]

1. Moving the Markets

Equities finished higher on the week, led by the increase in utilities and telecom stocks. The Dow rose 97 points to end the week at 17,098, up 0.6%. The S&P 500 increased 15 points, or 0.8%, to end at 2,003. In a week when the US economy showed renewed strength, the S&P 500 Index broke through the 2,000 milestone, despite escalating geopolitical tensions in Ukraine and Syria.

The pace of US economic growth in the second quarter was revised upward to a seasonally adjusted, annualized 4.2% from an initial estimate of 4.0%, the US Department of Commerce reported. Business spending on new buildings, machinery and research and development grew more than first estimated.

US economic reports also included improvements in two consumer confidence measures, though an unusually strong durable goods report was skewed by a large order for airplanes that will take years to fulfill. A slower pace of US home price increases, and a drop in the volume of new home sales, was seen as diffusing any potential US housing bubble.

One of the major M&A stories of the week was that of Burger King (BKW). Burger King Worldwide will buy Canadian coffee and doughnut chain Tim Hortons Inc. (THI), creating the world’s third-largest fast-food restaurant group, with $23 billion in combined annual sales and more than 18,000 restaurants in 100 countries. Burger King stands to save on corporate taxes by moving its headquarters to Canada, a controversial move known as a tax inversion.

9 of our 10 ETFs in the Spotlight managed to gain today with 4 of them making new highs for the year.


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Weekly StatSheet For The ETF/No Load Fund Tracker Newsletter – Updated Through 08/28/2014

ETF/Mutual Fund Data updated through Thursday, August 28, 2014

Table of Content082312

If you are not familiar with some of the terminology used, please see the Glossary of Terms.




Our main directional indicator, the Domestic Trend Tracking Index (TTI), broke through its long-term trend line generating a Sell for this area effective 8/9/2011. Over the recent past, we’ve seen the TTI hovering slightly below and above this dividing line between bullish and bearish territory. The clear break to the upside occurred on 10/24/11 and, effective 10/25/11, a new Buy signal for domestic equities went into effect.

As of today, our TTI (green line in above chart) is positioned above its long term trend line (red) by +3.21%.

To avoid a potential whip-saw, a Sell signal to move out of all domestic equity positions will be generated once we have clearly pierced the red line to the downside. Be sure to tune in for the latest updates.


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Markets React Negatively To Revived Concerns Over Ukraine; Cyber-Attacks On Banks

Thur pic

[Chart courtesy of]

1. Moving the Markets

It seems that international concerns trumped domestic economic outlook as market movers today, in that we received encouraging reports on economic growth, jobs and housing. Stocks dropped back below the 2000 mark on renewed concerns over the conflict in Ukraine. The major indexes came off their highs as the chart above shows.

Reports came in today that the economy grew faster than previously thought in the second quarter, as the government revised the growth in GDP to 4.2%, up from an earlier estimate of a 4% annual rate. Also, we heard that weekly jobless claims fell by 1,000 to 298,000 last week.

In the banking world, shares of JP Morgan (JPM) dropped today after a news report was released that the bank, and possible four other banks, were hit by cyber attacks. The FBI said it was working with the U.S. Secret Service “to determine the scope” of the attacks. JPMorgan CEO Jamie Dimon said his bank spends about $200 million each year to protect it from cyber attacks, according to his April 2013 letter to shareholders.

3 of our 10 ETFs in the Spotlight edged up slightly; no new highs were made.


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