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World’s Biggest ETF/Contrarian Indicator: GLD > SPY

Posted By Barry Ritholtz On April 15, 2013 @ 12:08 pm In Contrary Indicators,ETFs,Gold & Precious Metals,Technical Analysis | Comments Disabled

GLD was briefly the world’s biggest exchange-traded fund. In August 2011, GLD had assets of more than $77 billion, surpassing SPY (SPDR S&P 500 ETF) for a short time. The SPDR Gold Trust’s market capitalization rose to $76.7 billion  — gold briefly topped $1,880/ounce. At the same time, SPY’s “capitalization” was ~$74.4 billion.

I missed this detail in real time (I caught the Bond version in 2003). With the benefit of hindsight, its easy to say this was a contrarian signal. Not that you should short GLD, although that surely was a wonderful trade. But rather, that SPY was attractive, as this was a sign of extreme dislike for equities.

Have a look at the SPY chart and GLD (and Apple as well). click charts to enlarge them

 

SPY Weekly Chart 2008-2013
[1]

 

GLD Weekly Chart 2008-2013
[2]

 

And for a little comparison, here is Apple — GLD looks somewhat similar . . .

 

AAPL Weekly Chart 2008-2013
[3]


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URL to article: http://www.ritholtz.com/blog/2013/04/worlds-biggest-etfcontrarian-indicator-gld-spy/

URLs in this post:

[1] Image: http://www.ritholtz.com/blog/wp-content/uploads/2013/04/SPY.png

[2] Image: http://www.ritholtz.com/blog/wp-content/uploads/2013/04/GLD.png

[3] Image: http://www.ritholtz.com/blog/wp-content/uploads/2013/04/AAPL-Weekly.png

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