• HEDGEYE’S MARKET BRIEF
    Our FREE Investing Newsletter
    Get Exclusive Summer Sale Discounts

    By joining our email marketing list you agree to receive marketing emails from Hedgeye. You may unsubscribe at any time by clicking the unsubscribe link in one of the emails. All Hedgeye products and services are subject to Hedgeye’s Terms of Service available at www.hedgeye.com/terms_of_service

Editor's Note: Below is an excerpt from today's Early Look written by Hedgeye CEO Keith McCullough. Click here to learn more about the Early Look.

If You’re Long These 4 Things It's Been A Rough 2017 - spiral

Another way to think about winning in this game is not to be riding losers. In US Equity Style Factor terms, last week’s losers were the ones you should have been avoiding all year long:

  1. Sector Risk = Energy Stocks (XLE) down another -2.5% on the week to -17.3% YTD
  2. Quality (High Short Interest) = down another -2.0% on the week to -4.3% YTD
  3. Size (Bottom 25% of SP500 market cap) = down another -1.9% on the week to -1.0% YTD
  4. Growth (Bottom 25% of SP500 EPS growth rates) = down another -1.4% on the week to -0.2% YTD

*Mean performance of Top Quartile vs. Bottom Quartile for SP500 companies

Put simply, if you’re long, smaller, low-quality companies who have been levered to either Reflation’s Rollover or their own organic growth problems… that’s been a big problem.

If You’re Long These 4 Things It's Been A Rough 2017 - 08.21.17 EL Chart