Strategists at BofA-Merrill see U.S. small-cap outperformance

Strategists at BofA-Merrill see U.S. small-cap outperformance as fit to fade, predicting that earnings growth for the group will lag the market overall. By no means an illogical bet, as the iShares Russell 2000 ETF shorts are up almost half from their record low of four percent in January. But the bearish change in ETF short data shows that tech stocks may be the ones living on the edge.

Examining short interest data for ETFs tracking the S&P 500, Nasdaq 100, and Russell 2000 indices from just prior to the U.S. election, the outlier of bearish sentiment are the tech stocks, which have seen shorts treble, while S&P and Russell shorts have been chased out to levels below those seen before Trump was elected. Investors thinking the recent tech dip was only fleeting have to quickly decide if they want to be long a sector that may require weeks to bottom out.

Source: Bloomberg Pro Terminal

Trader – Senan Fuchedzhiev

 Varchev Traders

Read more:
If you think, we can improve that section,
please comment. Your oppinion is imortant for us.
WARNING: Any news, opinions, research, data or other information contained within this website is provided as general market commentary and does not constitute investment or trading advice. Varchev Finance Ltd. expressly disclaims any liability for any lost principal or profits which may arise directly or indirectly from the use of or reliance on such information. Varchev Finance Ltd. may provide information, quotes, references and links to or from other sites and blogs and other sources of economic and market information as an educational service to its clients and prospects and does not endorse the opinions or recommendations of the sites, blogs or other sources of information.
Varchev Finance