U.S. GDP Welcomes Back Bulls

by on July 28, 2012 | ETFs Mentioned:

Equity markets took investors for a roller-coaster ride last week as ongoing threats from the eurozone collided with mixed economic data releases on the homefront. Rising yields on government bonds overseas prompted ECB president Mario Draghi to make a statement reassuring investors that lawmakers would do whatever it takes to ensure the financial stability, and unity, of the debt burdened currency bloc. At home, investors were hit with mixed corporate performance results and worse-than-expected readings from the housing market. To top it off however, U.S. GDP results on Friday helped to restore confidence and bolster major indexes into green territory for the week [see also The Most Profitable Months To Trade Gold].

Actionable ETF Trade Ideas

Last Week’s Actionable ETF Ideas
Ticker Position Week Performance
ECH

Long

+0.5%
THD

Long

+2.3%
ELD

Long

+1.1%

Our picks from Monday’s Insider posted robust results during a fairly tumultuous week on Wall Street that ended on a positive note. Below, we highlight how our trade ideas fared during the week [sign up for a free trial of ETFdb Pro to get actionable ETF ideas every Monday, as well as access to more than 45 all-ETF model portfolios].

Trade #1 Long ECH: Up 0.5%
This recommendation got off to a worrisome start as shares of ECH slid sideways with a downward bias in the first half of the week. This ETF continued to trade within a range for the second half of the week, although Friday’s broad-based rally helped to propel it just above Monday’s opening price, leaving us with a small profit.

Trade #2 Long THD: Up 2.3%
This recommendation was spot on. THD held above the $67 level as we had anticipated and went onto resume its longer-term uptrend just as we had outlined in Monday’s Insider. THD was able to hold its gap on Wednesday and extend gains into Thursday; bullish price action across the globe bolstered THD towards $69 a share, leaving us with a solid profit and a well-timed trade.

Trade #3 Long ELD: Up 1.1%
This fundamentally defensive recommendation was able to thrive as risk appetites increased in the fixed income market throughout the week, which sent the U.S. dollar lower and emerging market currencies higher. ELD climbed higher virtually every single day, hitting a high of $51.51 a share on Friday afternoon and leaving us with a respectable gain on the week.

ETFdb Portfolios

Retirement ETFdb Portfolios

Our retirement-themed portfolios slumped lower across the board this week as bullish euphoria in the second half of the week prompted investors to pile into equities. From a year-to-date perspective, the 20 Years Til Retirement portfolio is in the lead, trailed closely by the slightly more aggressive 30 Years Til Retirement.

Regional ETFdb Portfolios

All of our regional portfolios posted a lackluster performance as heavy profit-taking pressures in the first half of the week took their toll on traditionally riskier markets. From a year-to-date perspective, our Africa-Centric Portfolio remains in the lead followed by our Emerging & Frontier Markets Portfolio.

Themed ETFdb Portfolios

Our GLD-Free Gold Bug Portfolio took the lead as demand for the precious yellow metal climbed amidst all of the uncertainty throughout the week. From a year-to-date perspective, the healthcare-centric Baby Boomers Portfolio still remains in the lead.

Disclosure: No positions at time of writing.