The market has been deflated over the past few days with concerns related to the oncoming fiscal cliff, but according to Cumberland Advisor’s David Kotok, the slowness is better blamed on Apple’s (NASDAQ” target=_blank>NASDAQ:AAPL) performance.
Apple has fallen nearly 28 percent since reaching a record high in September, while the S&P 500 stock index gained 0.6 percent from Election Day through the end of last week. According to Kotok, several exchange-traded funds tracking different versions of the S&P 500, but with much less Apple than its 3.8 percent share, have outperformed the index over the same period.
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The analyst pointed out in its note titled “A Rotten Apple?” that the Guggenheim S&P 500 Pure Value ETF has gained about 4 percent in approximately the same period and RevenueShares Large Cap ETF has gained 1.4 percent. The S&P MidCap 400 Index ETF is up 2.5 percent since the election, while the S&P 600 SmallCap Index is up 2.6 percent.
“Our conclusion is that the bull market remains intact since the election.” Kotok wrote, according to Barron’s. “Most stocks are rising in price and are discounting other and positive factors, not just the negative of uncertainty from politics. Looking at the benchmark SPY offers a distorted view because of the heavier weight of Apple. Maybe the pundit needs to eat some applesauce.”
According to Reuters data, Apple makes up 10 percent or more of assets in 117 out of the 1,119 funds that own its shares.