The Fidelity Sector Fund Rotational System continues to top-rank some surprising sectors. The U.S. consumer looks to have risen from the dead. Whether or not this trend will hold is anyone’s guess. Of course if you trade momentum, you will bet it will continue.
Version 1 Ranking:
- FSRPX (Retailing)
- FDCPX (Computers)
- FSCPX (Consumer Discretionary)
- FSHOX (Construction and Housing)
- FSPTX (Technology)
Version 2 Ranking: (Version 2 is not being traded live, yet)
- FSHOX (Construction and Housing)
- FSVLX (Consumer Finance)
- FSRBX (Banking)
- FDFAX (Consumer Staples)
- FSCPX (Consumer Discretionary)
Interesting. I keep reminding myself that in any given month the typical outperformance vs. the SPY may only be a few tenths of a percent, so I shouldn’t be surprised by the funds it picks – but I’m still surprised by the Version 1 rankings. Version 2 is more in line with my intuitive guesses. Does it look like Version 2 is catching up?
Version 2 is performing better than Version 1 since February but is behind overall YTD due to severe underperformance in January.
In theory, Version 2 is adapts to volatility while Version 1 does not adapt.