Miami Tidbits

A few months ago I put up a chart like this and used what is on this chart the maroon line to say I thought a bear market had started.

Recently I saw where some folks felt that SPX 1350 would be an important level and I think the green line makes it clear why someone would draw that conclusion.

Monday when SPX was above 1350 for most of the day and then closed at 1349 I thought that 1350 might in fact be significant. Wednesday opened with a small gap down and SPX stayed below 1350 all day.

Maybe today it will take 1350 back or maybe 1350--or 1359 the day high on Monday-- will be a turnaround point. Who knows?

The point is that technical analysis is not the be all end all tool. It is very useful at times but I don't think any tool can work all the time. The 1350 conclusion made a lot of sense based on the chart (anyone should feel free to offer up why that is wrong) but anyone making the decision to implement based on the action on Monday (hey 1349 is close) probably regrets doing so.

I did not sit in on every session yesterday at this conference I am attending but the tone of the ones I did sit in on and the one panel I participated in seemed move away from how to actually use ETFs in portfolio construction. The focus was more on asset growth or whether ETFs will or should focus more on alpha as opposed to beta and whether that is a good thing or not. On that last point Richard Kang had some very interesting things to say.

One very neat thing is I got a chance to bend the ears of the guys who created the Market Vectors currency ETNs. I pitched my idea of creating funds that would offer access to growth in a country that was independent of the stock market. The example I always using is with a rubber or palm oil or both as a proxy for Malaysia. Another example might be timberland, sheep, cows or wool from New Zealand, I view this as a way to to invest in what is actually happening on the ground as opposed to stocks. Eh, we'll see.

There seemed to be a lot of agreement that we need more fixed income ETFs but I am not sure that means we'll see more fixed income ETFs.

As I mentioned after the Super Bowl ETF conference last year there seems to be a lot of currency interest. In addition to the Market Vectors, Barclays is due to launch 3 new currency ETNs (one based on carry trade, on emerging markets and one on Asia and the gulf) very soon too.

I went over to South Beach yesterday afternoon to see the architecture and was not disappointed. I am flying out later today and I have to say that much to my surprise I have really enjoyed the visit here except for the airport. When I landed on Tuesday it seemed like a maze with crazy long lines everywhere. Oh, well.