Whether you are new to investing or an experienced investor, the ETF market is a great way to make sure that your portfolio is properly managed. As a matter of fact, you can even use these vehicles as a simple way to rotate your investment sectors.
During the bull run of the past few years, the IBD 50 Index has outperformed its benchmark brethren, the S&P 500, by a large margin. Its high octane stock tilt helps keep the returns coming. This list of fifty companies, compiled by Investor’s Business Daily, has some of the best track records of any comparable benchmarks in the US stock market.
The company has rolled out a number of new ETFs, including one that tracks the IBD 50 and its ilk. There are also a slew of inverse funds that will help to hedge your portfolio against the worst of times.
The Innovator IBD 50 ETF is an interesting hybrid of a traditional mutual fund and an Exchange Traded Fund. As the name suggests, the fund will track the IBD 50 Index, a sub-index of the S&P 500.
Low expense ratio
Despite its name, the IBD 50 ETF is not a low cost product. In fact, it has underperformed most of its peers in the past 12 months. However, it should have a strong future.
IBD 50 ETF was launched in April 2015 by Innovator’s Fund Group. It has been tracking the IBD 50 Index, an index of the fastest growing companies in the US market. Since its inception, the index has gained about five percent.
Initially, the fund was managed by Innovator Capital Management. It was then switched to a passively managed approach. The strategy is to select companies that meet biblically responsible investment standards. It has a 12-month trailing dividend yield of 1.41%.
CANSLIM is an investment strategy that is based on technical and fundamental analysis. It is a popular technique that has been used by investors for decades. It has a reputation for outperforming the market. In fact, it was the top performing investment strategy from 1998 to 2009, according to the American Association of Individual Investors.
Using CANSLIM, investors focus on high growth stocks with good earnings. They prefer companies that have large institutional ownership. During a bull market, these companies are likely to perform well. But during a bear market, these companies tend to drop a lot. CANSLIM can help you avoid losing a lot of money in this kind of situation.
Earlier this year IBD announced a new fund that tracks the IBD 50 index. As a matter of fact, the company recently switched from an actively managed fund to a passively tracked one. The fund’s name is Innovator IBD 50 Fund. The IBD 50 is a computer generated ranking of the best companies in America, including the top 500 equities by market cap. The illustrious fund is managed by Innovator Capital Management. IBD’s chief market analyst is Tim Reazor. Aside from his well regarded credentials, Reazor is a seasoned veteran in the investment arena, having previously served as a vice president of investment sales at the likes of Goldman Sachs and Credit Suisse.
Stocks in the IBD 50 lists have gained at all since 9/4
Historically, the IBD 50 list has outperformed the S&P 500. The IBD 50 list is comprised of a number of smaller, fast-growing companies. It also includes some domestic securities. This list is used by investors to identify stocks that have strong growth characteristics and relative price strength.
The IBD 50 is also based on a proprietary trading formula that identifies companies with strong technical catalysts and fundamental catalysts. It also aims to find top growth companies that have high returns on equity. These companies also tend to have big sales increases, and they usually have great profit margins.
The IBD 50 list has a 12-year track record of outperforming the S&P 500. The S&P 500 has gained nearly 5% since the index’s inception. The IBD 50 has outperformed the S&P 500 by almost 9% a year. It is a popular equity index benchmark.
ETFs make it easy for beginners to execute sector rotation
Investing in sector rotation is a great way to stay ahead of the market. Some sectors perform better than others at different stages of the economic cycle. In addition, a successful strategy will help you to diversify your portfolio.
While it is easy to rotate around sectors, it’s important to know what you’re doing. The goal is to buy into the next sector that is about to take off and sell into the sector that’s going down.
A good ETF is a simple way to accomplish these objectives. In addition, they offer direct access to the harder to invest in markets. This makes it easier for beginners to execute a rotational trading strategy.