Find missing ‘corners’ trading in any market…
How does an exchange traded fund (ETF) and a sector allow traders to better understand the broader averages and individual stocks?
In so many ways, ETFs give us more clarity versus the indices.
Let’s talk about these relationships…
Relationships between ETFs, indexes, sectors, and stocks are not adversarial, each piece has its value. Each piece is equally important and has its time and place but each piece tells us something different.
For our purposes in this conversation we’re talking about ETFs. It’s more about understanding what the passive investing environment has done. This market has been a slow, steady climb in terms of trader and investor behavior since 2008. So, how do ETFs help us to understand market behavior?
They break down, or like I say, tell us about the “corners” within the indices. Check out this video as I show you what this looks like…
The individual ETFs break down “the corners,” that is they tell us what are the outperforming and underperforming corners of that market.
Now think about the implications of not just looking at the NASDAQ as a whole, but rather getting a little bit more dialed into where the strength or weakness is coming from.
ETFs, aka “corners,” are so invaluable and so overlooked.
Once you understand this strategy, things like chop and shorts become very transparent and you’ll have the tools to see them beforehand. We don’t want to frontrun market behavior, we want to be ready as we see it coming.
Learn how to navigate markets within chop by understanding where sectors like healthcare, tech, and communications are going in terms of the broader movement.
I’ll dive deeper into these topics tomorrow, and this is your LAST CHANCE to join me for the class.
