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Do Sectors Signal Future Market Returns?

MJG
edited December 2011 in Fund Discussions
Hi Guys,

Can recent sector performance serve as a useable signal to forecast subsequent market performance? An excellent question that CXO Advisory has statistically studied.

CXO asked: "Do any of the major U.S. stock market sectors systematically lead or lag the overall market?"

CXU published its sector signal study findings today. They used the nine primary sectors defined by Standard and Poors and the ETFs that have been assembled to represent them as raw data fin their analysis. Here is the Link to their brief examination:

http://www.cxoadvisory.com/4416/economic-indicators/do-any-sector-etfs-reliably-lead-or-lag-the-market/#more-4416

CXO concluded as follows: “In summary, there is little evidence that any equity sector ETFs reliably lead or lag the overall U.S. stock market over the past 13 years. Utilities may slightly lag the broad market.”

There is not much gold in those hills.

Best Regards.

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