- Weekly summary and 2020 recap.
- Technical analysis of major indexes.
- Low volatility versus high beta S&P 500.
- Analysis of major indexes.
- Analysis of major ETFs.
- Analysis of sector, asset, country and commodity ETFs.
- Analysis of spot currency pairs.
- Chart of the week
1. Weekly summary
- Stocks gained on the last week of the year.
- High beta large caps rebound continued.
- Bond yields were flat.
- Gold and crude oil were higher.
- The U.S. dollar fell on the week.
Recap (December 28, 2020 – December 31, 2020)
|10-Year Note||-1 bps||-1.00%|
|Gold (London fix)||+1.0%||+24.2%|
|WTI Crude Oil spot||+0.3%||-20.9%|
2020 performance of SPY, TLT and GLD ETFs
SPY and TLT realized nearly the same total return in 2020, 18.3% and 18.2%, respectively, although GLD outperformed both with 24.8% return. Stock/bond portfolios were not impacted by allocation: a 60/40 portfolio in SPY/TLT had the same total return in 2020 as a 90/10 portfolio. As the chart below shows, in the last 19 years, there were only 5 years when returns of SPY and TLT diverged in sign but never in that period the return difference was so close to 0 when the returns of both ETFs were positive.
Below is a list of S&P 500 stocks with 100% or higher return in 2020.
TSLA joined S&P 500 late in the year but the stock had already surged to end the year up 743.4%. In NASDAQ-100, two stocks in addition to TSLA gained more than 400%: PTON and MRNA.
In 2020, the stock market offered many opportunities for large returns but risks were also higher due to a crash earlier in the year. It is unlikely that 2021 will offer similar opportunities to traders and investors; a consolidation is the most likely scenario if central banks do not continue to pump markets with quantitative easing.
2. Analysis of major indexes
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Specific disclaimer: This report includes charts that may reference price target levels determined by technical and/or quantitative analysis. No updates to charts will be provided if market condition changes occur that affect the levels on the charts and/or any analysis based on them. All charts in this report are for informational purposes only. See the disclaimer for more information.
Disclaimer: No part of the analysis in this blog constitutes a trade recommendation. The past performance of any trading system or methodology is not necessarily indicative of future results. Read the full disclaimer here.
Charting and backtesting program: Amibroker
Data provider: Norgate Data