Give me some tickers. Either ones that you think have performed excellent over time, either just generally good on a upside to draw-down ratio, or are interesting because of some other reason - maybe they don't go up quite as much, but they have a very low beta or negative beta, or they are a sector that zigs while the market zags, or pretty much any legitimate reason you think they a potential hold (even if only temporarily) for anyone. I'll test them versus the SPY and post my results here. I'm all ears!!!
I get asked this question a lot by friends/relatives. For those who are risk-averse, especially retirees or near retirement, I usually recommend SDY (SPDR S&P Dividend ETF). Decent yield (usually around 3.5%), medium chance of capital appreciation, but price never falls too far even when the market is tanking. For those who want a more aggressive investment, I recommend SPGP (Invesco S&P 500 GARP ETF - Growth at Reasonable Price). SPGP usually outperforms QQQ and XLK during bull markets, but does not fall quite as low during bear markets.
Here are ETFs whose three-year, daily return correlation (QuantDare method) with any other ETF in the set is less than a threshold in attached semicolon-separated file.
All per yahoo finance, SDY started trading 11/15/2005. Since then if you had been 100% invested in it you would have an IRR of 9.08% and a max DD of 54.75% (ouch!). SPY, for that same period - IRR of 9.20% and max DD of 55.19%. So yea, overall just a bit more return and a bit less DD than SPY, but just barely. SPGP - started trading 6/16/2011. IRR 15.11% max DD 42.08%. SPY same period - IRR 12.5% max DD 33.72%. SPY has just a very slightly bit IRR/max DD ratio. XLK - from 12/22/98. IRR 7.32% Max DD 82.05% (double ouch!). SPY same period - IRR 7.00% Max DD 55.19%. XLK does not look good. Its interesting, the max DD was on 10/9/2002 - did it take that long for the tech crash that started around 2000 to fully play out? That was a LONG tech crash! So none of those really move my needle, but I hope they move someones! Thanks DaveV!
Interesting! So that is a HUGE list of 6400+ funds. On each line I see a fund symbol, then another one that looks like it has the smallest amount of correlation with. So is that a list of essentially all funds, sorted in order, the order being that it starts with the ones that have the least correlation with any other fund in the list, and the fund in the list that is it so least correlated with being listed? And going from low (negative) up to high correlation? Am I understanding that correctly? Thanks!
Each line in the file is the correlation between two ETFs, sorted low-to-high correlation. There are a total of 114 ETFs (see attached file with a list of all of them).
Thanks ph1l. So in any given line, the 2nd ETF listed is the one in that 114 ETF list that is least correlated with the first ETF listed, correct? Shames its only 114 ETFs. And given that VXX and what not is in there, so much stuff is inversely correlated to it (VIX goes up when stocks drop), many of those are not helpful I would guess. Then there are like currency ones inversely correlated with other currency ones or similar stuff. Still, I'm already spotting a few interesting ones I want to test... Thanks!
You are welcome. I was adding some ETFs to my watch list a few months ago, when I found this site with thousands of ETFs. I would suggest you use a screener to see which ones are performing the best and that meet your criteria.