The market is going higher but that does to mean that stocks or going higher. It can be that just the large caps are moving higher. A simple measure of market breadth is the difference between the cap-weighted SPY and the equal weighted RSP. The market cap index is at extremes, but it can fall significantly as seen in 2022. If you think that the magnificent 7 are at extremes but you are unsure of which stock will decline, you can trade the differences in breadth as an alternative. The indices are liquid and can give a different perspective on the overall market.
No comments:
Post a Comment