$XBD broker dealer index on 2 April: what happened?

Discussion in 'Stocks' started by m22au, Apr 5, 2013.

  1. m22au


    Do you know what happened to the $XBD (AMEX broker dealer) index on 2 April?

    As shown in the attached chart, the index closed at 105.72 on 1 April, but then opened at 108.90 (up 3%) on 2 April, despite index components such as GS and MS not moving by that amount.

    Was there some kind of index adjustment?

    I cannot find anything via Google or via the AMEX web site.
  2. m22au


    An alternative index for the $XBD is the
    $DJSINV (Dow Jones U.S. Select Investment Services Index)
    or the iShares Dow Jones US Broker-Dealers ETF (symbol IAI)

    This 5-day chart of $XBD versus IAI shows the big change in $XBD at the open on Tuesday:

    Whereas today, the $XBD and IAI closely track each other:
  3. just trade xlf and don't worry about the index.
  4. m22au


    Thanks for your reply Frank, however I'm interested in the $XBD from an indicator point of view, rather than directly related to any particular trading strategy. Given the weird action on 2 April, the $XBD suggests that broker-dealer stocks have been much stronger in the past week than the picture shown by the IAI (iShares Dow Jones US Broker-Dealers ETF) etf.

    In any case, the IAI has a stronger correlation with $XBD than the XLF etf.
  5. i see the iai and gs, ms pretty much the same (very much over past week) and xbd much stronger than all of them. given that you can't trade xbd it seems better to just focus on the etf's, underlying stocks.
  6. m22au


    Yes, you are right, it is better to focus on the IAI etf rather than $XBD. However I am in the habit of looking at $XBD so this will require some behavior modification on my part.

    Under the broad heading of "financial" I usually look at the following indicators:


    but now I will look at IAI (and $DJSINV) instead of $XBD.

    Still, if you or anyone else does know what happened on Tuesday 2 April, I would be interested in the answer.