Chart Talk {04.20.16}

Chart is from Tradingview.com.

One interesting note when looking at this chart.  If you had bought the S&P 500 back in early December, 2015 you would be slightly above water on the trade.  You would have endured two downdrafts of roughly 10% during the period.  However, you would have also collected $6.39 in dividends since your purchase.  The dividends are indicated by the circled "D"   on the chart.  If you go to Tradingview.com and punch in SPY you can hover over that "D" and see the date and the amount of each payment.  The annualized yield is just slightly over 2%. The current yield on a one year US treasury is 49 basis points or 0.49%.  The 10 year US is 1.77%.  If you can stomach the volatility in markets and understand that at some point corrections in stocks occur, you can currently receive a better yield in the S&P 500 than you can from US government bonds.  I stress yield here because I'm focusing solely on the yield, not price appreciation or total return.  I also will point out that the actual dollar gains from that yield can be lowered or wiped out when stocks correct.  However in the case of this current market phase, where we've basically gone nowhere since December of 2015, you've literally been paid to wait by owning SPY.

*Long ETFs related to the S&P 500 in client and personal accounts.  Please note that positions can change at any time without notice.