Charts of the Day: Don't Chase

In the video commentary that you clients will receive shortly, while explaining our maneuvers this year within the tech sector I touch on the record concentration among very few stocks within the major cap-weighted averages.

Believe it or not, both the blue and the white lines on the charts below show the price moves for the S&P 500 Index. Difference being the white line is the S&P 500 Index, the blue being the S&P 500 Equal Weight Index -- in which all positions individually share the same influence. I.e., the latter being a better reflection of overall market conditions.

This morning's chart:


Year-to-date: (S&P 500 -0.2%, S&P 500 Equal Weight -8.54%):


As I type this morning the S&P 500 is up .5%, while the Nasdaq is up a whopping 1.8%. All the while the healthcare, materials, energy, industrials, staples, utilities and transportation sectors are all trading lower. 

Not a market to be chasing after...