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<\/a><\/p>\nSeeing this, the natural reaction was to blame it on the market being choppy and down a little over the last 30-trading days. However, that is only part of the story. From June 19 through July 31, the S&P was down slightly (0.29%) and yet the HedgeCoVest Index Short-Only model was up 5.15%. That difference in performance is huge and a product of proper stock selection. In this case it is selecting the right stocks to short rather than the right ones to buy.<\/p>\n
What about the other short-only models in the top five, how did they compare to their comparable sector ETFs? The Materials Select Sector SPDR (NYSE: XLB) was down 8.48% during the 30-day period while the HedgeCoVest Basic Materials Short-Only model was up twice as much as the ETF was down with a gain of 18.81%.<\/p>\n
The third short-only model in the top five performing models in the last 30 days was the HedgeCoVest Technology Short-Only model with a gain of 4.84%. The Technology Select Sector SPDR (NYSE: XLK) was up 0.09% during this time.\u00a0Here we see a case where our short-only model produced a sizable gain while the long-only ETF produced a small gain.<\/p>\n
These three models were able to produce significant gains and gains that were much greater than the declines in the ETFs and index they are designed to provide a hedge against. Every bit of the outperformance can be attributed to timing and stock selection.<\/p>\n