There is an interesting opinion that I have read on the web that it wasn’t Trump who put the metals on the rise as many people think, it could be the Chinese huge economic stimulus instead, as shown in the chart below.
Chart 1. China Government Spending, China Interest Rate
Chart courtesy of tradingeconomics.com
I decided to make my own analysis of the price dynamics to check this assumption.
Chart 2. 1-Year Comparative Chart of ETFs and Metals: Synergy Wins!
Chart courtesy of tradingview.com
In the chart above, I have combined three ETFs and three metals for clear illustrations of two important things - the first thing is timing and the second thing is the result of the instrument choices.
With 2016 coming to an end, let's take a look at a few of the top performing Exchange Traded Funds of 2016. With the major indexes up for the year; Dow Jones Industrial Average (DJI) up 14%, the S&P 500 (SP500) up 10.75%, and the NASDAQ (COMP) up 9%, one may think the top performing ETFs would be up just slightly more than that. But, that's not the case by a long shot.
The top 2016 ETFs are all up more than 100% year-to-date!
So, let's take a look at what performed well this past year and whether or not their performance will continue moving forward.
Shares of Direxion Daily Regional Banks Bull 3X Shares (PACF:DPST) have risen more than 114% year-to-date. The ETF focuses on US regional banking stocks but leverages its bullish exposure three times. What is interesting is that while DPST is up 114% year-to-date, it's up 107% over just the last three months. In the last three months the Presidential Election took place and Donald Trump's surprise victory has sent stocks in a number of industries higher. The banking industry had been demonized since the financial crisis and government regulation has really held back the industry. Trump told voters during the campaign that he would de-regulate, and many believe that includes the banking industry. Continue reading "Top Performing ETFs of 2016"→