Update on the Homebuilders

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Weekly sector ETF chart. Still working through a broadening megaphone pattern, though the second chart shows the continued RSI divergence. Too early to short without a trigger, but the upside momentum is not as powerful and explosive as you might expect with the bullish data reported.

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4 Responses to “Update on the Homebuilders”

  1. Since ’08 I’ve heard the term “housing market” thrown around a lot. I assume this refers specifically to residential real estate and also represents the idea that growth in the housing market is key to a real recovery of the American economy.

    My question then is, does IYR or XHB better measure the American housing market recovery? TIA

    • Good question. I think XHB has less dividend yield plays and is higher beta, probably thus more sensitive to economy.

      • IYR is a real estate index linked product with about a 1/2% expense ratio vs XHB which is also an index linked product, but only tied to home builders, and with a slightly lower expense ratio. XHB has a much smaller “float”, so, in the short run, it’s hard to make sure that the NAV doesn’t go adrift, but over the lon haul it’s actually closer to its benchmark than the XHB (largely expense ratio related).

Comments are closed.
Previous Posts by chessNwine

Update on the Homebuilders

308 views

Weekly sector ETF chart. Still working through a broadening megaphone pattern, though the second chart shows the continued RSI divergence. Too early to short without a trigger, but the upside momentum is not as powerful and explosive as you might expect with the bullish data reported.

_____________________________________

_____________________________________

4 Responses to “Update on the Homebuilders”

  1. Since ’08 I’ve heard the term “housing market” thrown around a lot. I assume this refers specifically to residential real estate and also represents the idea that growth in the housing market is key to a real recovery of the American economy.

    My question then is, does IYR or XHB better measure the American housing market recovery? TIA

    • Good question. I think XHB has less dividend yield plays and is higher beta, probably thus more sensitive to economy.

      • IYR is a real estate index linked product with about a 1/2% expense ratio vs XHB which is also an index linked product, but only tied to home builders, and with a slightly lower expense ratio. XHB has a much smaller “float”, so, in the short run, it’s hard to make sure that the NAV doesn’t go adrift, but over the lon haul it’s actually closer to its benchmark than the XHB (largely expense ratio related).

Comments are closed.