Spider Hunting

With great power comes great responsibility.

At StockViz, we are big fans of diversified portfolios. While investing in international funds have gathered traction lately, Indian investors continue to be under-diversified. We have been beating the drum for having international funds in your portfolio for a while now:

  1. Funding Your Dollar Dreams

  2. ETFs for Asset Allocation

  3. The United States of ETFs

  4. Factor Momentum Everywhere

This week, we began our exploration of Sector Spiders - SPDRs (Standard & Poor's Depository Receipts) - a collection of about a dozen ETFs that represent different sectors within the S&P 500.

We like these ETFs because they have been around for more than 20 years and their prices are β€œreal.” Traded instruments encapsulate all the trials and tribulations involved in the real world, unlike the back-filled prices of recently launched indices.

Fun with SPDR Sector ETFs explores historical returns, volatility and cross-correlations. There’s also a quick backtest that checks for low-hanging fruit. Do read and let us know what you think.

We’ll explore common investing strategies around these ETFs in the coming weeks. Please forward this newsletter to your friends who might be interested!

Meme of the Week