The 2012 Ex-Dividend and Pay Date information below is based on Ishares distribution schedule,
DVY Ishares Dow Jones Select Dividend Index Fund
Ex-Dividend 26-Mar-12 19-Jun-12 25-Sep-12 19-Dec-12
Pay Date 30-Mar-12 25-Jun-12 1-Oct-12 3-Jan-13
Looking for ex-dividend information for other ETFs? Check this page.
The intraday SPY prices for the last two days have overlapped with SPY’s March 9th and 10th 2004 values.
Since March 9th, 2009 the SPY values exactly 6 years apart have matched each other within 15 points all the time and on average have closed within 4.5 points of each other. While the calendar synchronicity is surprising, it isn’t surprising that the recoveries after two big crashes have looked similar–a huge recovery rally, followed by some sideways action. The volatility of the 2010 sideways action has already been 2X what we experienced in 2004, so I think it is fair to predict a wider trading range moving forward. The big question though, is whether we stay in a similar, albeit wider, trading range, or will we breakout one direction or the other.
As usual the doomsayers and boomsayers are present in roughly equal parts. The state of the commercial real estate market looks grim, but it doesn’t have the feel of the general destabilization that accompanied the personal real estate crash. Small and medium banks, not too big to fail, seem to have most of the exposure–when they fail it isn’t as scary. And when a commercial property owner does default on their loans the leasers don’t disappear, their choices stay about the same. A large local shopping complex recently into default and reverted to the original sellers. The defaulters were out their interest, the sellers got their property back, and the shoppers kept shopping–hardly a nightmare scenario. Stock valuations look high, but they usual do at this point in a recovery, because profits have not fully recovered.
High unemployment will dampen consumer spending and governments will continue feeling the pain from expanding their spending and benefits to the max during the boom times, only to discover that it is harder to cut than to add.
I’m betting on sideways.
SPY 2003/2004 vs 2009/2010, click to enlarge.
I have been not so patiently waiting for the market to pick a direction. I have been surprised at the strength of the rebound from the lows a month ago–we are less than a point away from SPY setting 15 month highs. My gut is still telling me we are in a trading range similar to 2004 and 1999 after big bull run-ups, but I’m not willing to put a lot of chips down to back that up. I’m still about 80% in cash, with my bearish SDS play somewhat in the red. Oil looks high, and I’m not anxious to try and capture the upcoming March SPY dividend because of what feels like downside risk.
Over the last year I have not tried to strongly play the downside moves, but I wondering if I should be, for example going long on VIX options, or shorting SPY in some fashion. The upside odds look quite a bit lower than the downside odds right now.
SPY 150 day chart, click to enlarge
Off the trendline, but what’s next?
SPY 150 months, click to enlarge
The surprising date / value / normalized volume correlation on the S&P 500 between 2004 and 2010 continues, with the 3rd of March SPY closings only differing by 3%. If 2010 continues to track 2004 then we should see an ongoing ramp in trading volume, with a 30 day moving average of around 300 million shares per day on SPY, compared to the current run rate of about 220 million. After spiking up to almost 500 million shares on the recent bottom on Feb 9th things have quieted down. People are understandably nervous, with only the most optimistic forecasting a continued strong bull market.
My gut is telling me that we are approaching the 2010 top trend line–but the bulls are in control right now, at least until tomorrow…
S&P 500 2004 vs 2010 comparison, click to enlarge
I continue to scan for ways to profit on what I believe will be the inevitable rise of interest rates in the future. I think the classic 30 to 40% weighting in bonds that financial advisers propose for balanced risk, moderate growth portfolios is going to be a big loser in the next couple of years.
This Bloomberg webpage has a daily graphical update of the US government bills/bongs yield curve, plus going rates on TIPS, Corporates, Municipals, etc.
This page on Smartmoney.com gives a tutorial on the yield curves, allowing you to compare today’s yield curve against historic ones, and showing the various shapes the curve can take.
This article (“Duration–the looming scandal“) on bonds, illustrates how the duration of a bond or collections of bonds can be used to easily estimate the principal value impact of interest rate changes.
My USO position and my remaining SPY covered call positions were called this weekend, so I’m back to about 90% cash. Despite the scary stuff in the last couple of weeks, they ended up yielding their maximum profit potential.
Oil looks expensive right now, so I wouldn’t be surprised to see a pull back there. The S&P 500 could certainly go higher with this rally, but looking at the 250 day chart the resistance level at 111 really stands out. This one could be tough to break through. Click chart to enlarge.
