Over the last couple of weeks, we’ve been looking at different ways to trade the S&P 500 Sector SPDRs (Spiders.) We started with using the Efficient Frontier to make the allocation decision for us in our first post:
Then, we looked at buying the best performing sector over different time-frames.
None of them worked.
This week, we tried the opposite: What if we bought the worst performing sector?
Turns out that once again, it worked before 2010 and failed in the subsequent decade. Inquisitive readers can find the highlights here.
Next week, we’ll look at a momentum based weighing scheme. It is the last one, we promise!
Finally finished reading Agustin Lebron’s The Laws of Trading. It gets a bit tedious sometimes but it is well worth the read. Some thoughts.
Meme of the Week
Don’t fight the tape!