Thursday, January 7, 2016

M11 Looks at DEFENSE...01.07.16

North Korea, Syria, Iran, Afghanistan and those pesky Soviets....jeez... can't we all just get along?
Not likely. With POTUS trying to disembowel the military and the GOP front runners urging a ramp up what are the prospects for the Defense industry?.
Here's M11's objective spin on the largest defense ETF ...ITA ...and 10 of the largest defense contractors. This is a diverse group of defense providers and each has its own idiosyncrasies. Overall ITA has not done very well both short and longer term but a top #2 ranked sort based on momentum has performed appreciably better.  The limit stops are all set to .7% which may or may not be reasonable given the tendency for jumpy prices in these issues.  Nevertheless this study is intended as a jumping off point for further studies and, as always, we recommend using end of day M11 for opportunity studies and M3 real time for actually managing the positions with pre-close trade executions.