Moving Averages Month-End Preview
This article was originally written by Doug Short. From 2016-2022, it was improved upon and updated by Jill Mislinski. Starting in January 2023, AP Charts pages will be maintained by Jennifer Nash at Advisor Perspectives/VettaFi.
Here is an advance preview of the monthly moving averages we track after the close of the last business day of the month. At this point, before the close on the last day of the month, three of five Ivy portfolio ETFs — IEF, VNQ, and DBC — are signaling "cash," an increase from last month's final single "cash" signal.
If a position is less than 2% from a signal, it is highlighted in yellow.
Note: Our inclusion of the S&P 500 index updates is intended to illustrate a popular moving moving-average timing strategy. The index signals also give a general sense of how US equities are behaving. However, for followers of a moving average strategy, the general practice is to make buy/sell decisions on the signals for each specific investment, not based on a broad index. Even if you're investing in a fund that tracks the S&P 500 (e.g., Vanguard's VFINX or the SPY ETF) the moving average signals for the funds will occasionally differ from the underlying index because of dividend reinvestment, which is not factored into the index closes.
The Ivy portfolio
The second of the three adjacent tables previews the 10-month SMA timing signals for the five asset classes highlighted in the Ivy portfolio.
I've also included (third table) the 12-month SMA timing signals for the Ivy ETFs in response to the many requests to include this slightly longer time frame.
After the end-of-month market close, I'll update the monthly moving average feature with charts to illustrate.
These moving-average signals have a good track record for long-term gains while avoiding major losses. They're not foolproof, but they essentially dodged the 2007-2009 bear and have captured significant gains since the initial buy signals after the March 2009 low.
Check out the Ivy Portfolio ETFs here: Vanguard Total Stock Market ETF (VTI), Vanguard FTSE All-World ex-US Index Fund (VEU), iShares 7-10 Year Treasury Bond ETF (IEF), Vanguard Real Estate ETF (VNQ), and Invesco DB Commodity Index Tracking Fund (DBC).
Check out ETFs associated with the S&P 500 here: iShares Core S&P 500 ETF (IVV), SPDR S&p 500 ETF Trust (SPY), Vanguard S&P 500 ETF (VOO), and SPDR Portfolio S&P 500 ETF (SPLG).