The trend this past week was clear - investors feared that credit risks would spread through the corporate world, either directly or via lending crunch, but still believe that the market can regulate the issue and that fixed-income assets are safe enough.
I come to that last conclusion by seeing treasuries continue to strengthen against the S&P as well as gold and silver. Worst hit by credit fears, as could be predicted, are small caps, who are obviously most likely to be hit by more stringent credit standards.
This week brought further downside and volatility to the market, with only 8 of 26 categories positive and an average week category return of -1%.
Of those 8 categories that ended the week up, only utilities, Europe, commodities, and short funds were up over 1%.
Of the 18 categories that ended the week down, 15 were down over -1%, 8 were down over -2%, and 3 were down over -3%. The worst performers were infrastructure, transports, energy, and China.
At this point, only the currency, commodity, and short categories are currently up over the past trading month.
Year-to-date, large- and mid-cap categories have only marginally positive adjusted close returns, with small-caps already sliding beneath par.
ETFs and CEFs With Lowest Absolute Correlation to S&P 500 Over the Past Month
Of these 28 funds with absolute correlation to the S&P 500 below 10%, 20 are municipal funds from Nuveen, BlackRock, and other issuers. The remaining 8 are global, country-specific, currency, and commodity funds.
ETFs and CEFs With a Weekly Average Dollar Volume Over Twice the Monthly Average Dollar Volume
Here's a table of the ETFs and CEFs that traded an average in the past week at least twice the last month's average dollar volume.
UCC, the ProShares Ultra Consumer Services ETF, is seeing the highest relative levels of accumulation on this downtrend, though the total dollar accumulation is not quite so high. Likewise for HHE, GWL, HHB, FRI, and FXO, and FXS, which also traded under $5M over the last month.
The most promising accumulations in both relative and absolute terms this week took place in VHT with $51M, VCR with $35M, UYG with $23M, and FXS with $12M. VHT and VCR are both Vanguard World funds (ex-US diversification), FXS is the ProShares Ultra Financial fund (this managed-futures double-leverage fund is down from $70 to under $50 in the last two months), and FXS is the CurrencyShares Krona fund (possible speculation on the Swedish executive board meeting August 23rd).