The bull train continued full steam ahead on Wall Street this week as investors had few reasons to take profits off the table even in the face of multi-year highs for major equity indexes. Upbeat earnings results from Google and IBM bolstered the tech-sector early in the week, while Apple’s miss yesterday created headwinds for a number of ETFs that feature major allocations to the bellwether stock. The S&P 500 Index managed to peek above the 1,500 level for the first time in five years, while the grandfather of all ETFs, State Street’s SPDR S&P 500 (SPY), celebrated its 20th birthday on Tuesday with a rally [see Visual History Of The S&P 500].
Adding to the string of good news is the latest weekly jobless claims report, which showed that 330,000 people had filed for unemployment benefits versus the previous reading of 335,000. With no new product launches this week and corporate earnings season in full swing, investors will continue to digest quarterly performance results over the coming days [see also 101 High Yielding ETFs For Every Dividend Investor].
Below we outline five insightful articles circulating around the financial space this week:
- Expensive High Yield at The Aleph Blog
With interest rates still hoovering near record lows, and expected to remain there for the foreseeable future, investment professional David Merkel takes an in-depth look at bond market valuations. This article take a quantitative approach in analyzing the current state of the corporate bond market and offers intriguing conclusions that both bond bulls and bears should consider.
- Inexpensive Ways to Hedge SPY at ETF Guide
Given the stellar run-up on Wall Street since the start of the new year it’s no surprise that many are hesitant to jump in as a steep correction seems to be just around the corner. In this article, author David Pinsen makes the compelling case for using ETF options to buy downside protection at current levels.
- The Appeal of Investments That Cost More and Return Less at The New York Times
With investors constantly on the prowl for uncorrelated sources of return, author Carl Richards takes a closer look at why many wealthier individuals continue to flock to hedge funds. In this article he discusses the inherent drawbacks of hedge funds, namely their unimpressive performance track records and sky-high management fees.
- Overbought and Overvalued Market? Consider One Or More Unconventional ETFs at ETF Expert
Amid the current “hyper-price-appreciating” marketplace, author and ETF expert Gary Gordon offers his thoughts on diversifying your current income sources. This article takes an in-depth look at two dividend-paying funds that also present attractive capital appreciation opportunities.
- The Temptation of Risk at Alhambra Investment Partners
In this article, seasoned money manager Joseph Calhoun discusses his thoughts on the well-known phenomenon of peer pressure as it relates to the current state of the markets. He takes a look at just how much investors’ sentiment has changed in such a short period of time, and offers words of warning to those eagerly chasing the bull train.
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Disclosure: No positions at time of writing.