Major Asset Trends: Emerging Market Stocks Had a Bigger Drop while U.S. REIT Held Up Well
11/30/2010 0 comments
Asset trends provide insights into underlying economic and market segments and are critical to tactical asset allocation strategies. We use ETFs that represent the asset class indices.
Last week, as the European debt situation started to unfold, risk assets continued their downtrend while fixed income recovered somewhat (especially in safer bonds such as investment grade credit bonds), reflecting a reduced risk appetite. It is another watchful week. Given the uncertainty in world economics, investors should be in a heightened alert state on the markets.
|
Assets Class |
Symbols |
11/26 |
11/19 |
Direction |
|---|---|---|---|---|
|
Frontier Market Stks |
(FRN) |
14.18% |
16.78% |
v |
|
US Equity REITs |
(VNQ) |
10.71% |
8.76% |
^ |
|
Emerging Market Stks |
(VWO) |
7.85% |
11.59% |
v |
|
Gold |
(GLD) |
7.74% |
8.55% |
v |
|
US Stocks |
(VTI) |
7.64% |
8.28% |
v |
|
International REITs |
(RWX) |
7.15% |
9.99% |
v |
|
Commodities |
(GSG) |
4.61% |
3.12% |
^ |
|
US High Yield Bonds |
(JNK) |
4.05% |
6.13% |
v |
|
International Developed Stks |
(EFA) |
3.67% |
8.08% |
v |
|
Emerging Mkt Bonds |
(PCY) |
3.45% |
3.64% |
v |
|
Intermediate Treasuries |
(IEF) |
2.34% |
2.15% |
^ |
|
US Credit Bonds |
(CFT) |
2.06% |
1.97% |
^ |
|
Mortgage Back Bonds |
(MBB) |
1.55% |
1.57% |
v |
|
Total US Bonds |
(BND) |
1.05% |
1.04% |
^ |
|
Treasury Bills |
(SHV) |
0.02% |
0.03% |
v |
|
International Treasury Bonds |
(BWX) |
-0.15% |
2.01% |
v |
|
Municipal Bonds |
(MUB) |
-1.1% |
-1.68% |
^ |
click to enlarge
The riskiest asset, frontier market stocks, remains in the top spot while emerging market stocks had a much bigger drop than the U.S REITs.
Inflation in China, the Korean peninsula tension and the Irish debt problem were some major reasons behind the drops of emerging market stocks and international developed stocks.
Municipal bonds recovered a bit while international treasury bonds had another decrease mostly due to the debt situation and dollar's strength. Treasury bills remained unchanged, which is expected. Emerging market bonds had a little drop, but are still pointing to an up trend.
In conclusion, the market continued its gyrations, trying to figure out the next trend. It might or might not be a trend turning point. Since the world economics is not out of the woods yet, it pays to keep monitoring events closely.
labels:investment,
Symbols:AGG,BND,BWX,CFT,DBA,DBC,EEM,EFA,EMB,FRN,GLD,GSG,HYG,ICF,IEF,IWM,IYR,JNK,MBB,MUB,PCY,PHB,RWX,SHV,SPY,TLT,VEU,VNQ,VTI,VWO,
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