Chart of the Day: Winners Win
You can see here how important that 86 level is for Crude Oil Futures. If prices are above that, then I have no problem owning Crude.
But again, it's the relative strength in Energy stocks that continues to grab my attention.
You can find my favorite Energy stocks to own on our Trade Ideas page where I detail the entry and exit prices. And remember it's organized even better in our NEW Rangefinder App.
If you don't have access to either, just shoot me and email and we'll get you in.
But with that theme in mind, you can really see the differences among Emerging Markets.
Look at the performance of EM with China vs without China. And we also included the EM Ex-China, Taiwan & S. Korea to really drive home the point.
See the massive difference?
China has a 5% weighting in Energy. Taiwan has a 0% weighting in Energy. And South Korea has a 1% weighting.
You can see the lack of exposure "weighing" on their performance. (see what I did there?)
Meanwhile, Brazil has 17% exposure to Energy. Indonesia and Saudi Arabia each have an 8% weighting.
There are countries that are better exposed to the winning areas and less exposed to the losers.
Not all emerging markets are created equal.
Not all S&P sectors are created equal.
Americans don't have nearly enough energy exposure. That's the bottom line.
If you own the S&P500, then only 4% of your money is in Energy. If you own the Nasdaq100, then 0% of your money is in Energy.
So you decide.
How are you going to play this?
Feel free to chime in.
Let me know what you think!
- JC