Bull Run Continues After Earnings

by on January 12, 2013 | ETFs Mentioned:

Major equity indexes continue to hold on to the massive gains accumulated during the first trading week of 2013. Frustrated bears were quick to point out that a correction will ensue as soon as earnings season comes around, however, their prediction hasn’t exactly panned out seeing as the first round of corporate performance results has been fairly upbeat. To top it off, better-than-expected China exports data is giving further weight to the ongoing bullish price action on Wall Street [see Free 7 Simple & Cheap All- ETF Model Portfolios].

Actionable ETF Trade Ideas

Our picks from Monday’s Insider posted solid performance results as our conservatively bullish expectations proved correct. 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 50 all-ETF model portfolios].

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

Long

+0.3%
OFF

Long

-1.4%
QQQ

Long

+1.2%

Trade #1 Long LQD: Up 0.3%

This recommendation kicked off the week on a positive note and buying pressures in the investment grade fixed income market remained strong throughout the entire week even as equity markets climbed higher. LQD ended the week in green territory and while our recommendation was well-timed, the profit was fairly small given the stronger bullish sentiment over on the equity front. 

Trade #2 Long OFF: Down 1.4%

This defensive recommendation proved to be unnecessary. With Alcoa kicking off earnings season on an upbeat note, stocks were able to continue their bull run, which drove investors away from safe haven assets included in OFF’s underlying portfolio. This recommendation fell to a level just pennies away from our stop-loss and ultimately ended in shallow red territory for the week. 

Trade #3 Long QQQ: Up 1.2%

The Nasdaq managed to hold its gap and continue higher as corporate earnings kept bullish sentiment alive throughout the week. QQQ dipped a little bit on Tuesday, although it managed to hold above $66 a share and resume its upward trajectory the following days. This ETF ended the week on a positive note and left us with a solid profit. 

Disclosure: No positions at time of writing.