Use ETF Holdings To Target The Strongest Stocks

ETF Holdings Deepvue

Watching the indices gives us an overall idea of how the markets are performing, but as a trader of individual stocks it is important to trade the leading names.

This blog will help you use Deepvue's ETF holdings feature to stay on top of market rotation while focusing on strength with performance ratings and rankings.

By looking through a broad lens first, then concentrating on the strongest sectors, you will be on the right path to discover outperforming stocks.

A Top Down Approach

As a stock trader, we always want to be on the right side of the trend. Many traders analyze the movement of the overall market by watching the indices and various ETFs, in addition to the individual stocks.

A top down approach starts by looking at the overall market first, then the sectors, and finally the individual stocks.

When the NASDAQ is outperforming other indices, we see tech related stocks begin to run. When the S&P 500 is acting stronger, more cyclical stocks are in favor. If the IWM begins to move rapidly, smaller cap names take the spotlight.

Market Top Down Approach Deepvue

Refine Your Focus

With thousands of stocks to choose from, how do you narrow down your focus to the very best stocks?

1. Begin by monitoring the indices to analyze the overall health of the market.

💡 Pro Tip: 3 out of 4 stocks move with the general market

2. Compile a list of ETFs and sort by relative strength. Regularly examine an ETF watchlist to stay in tune with the strongest outperforming sectors & industries.

💡 Pro Tip: 37% of a stock's move is related to its industry and 12% of the move is related to the sector

3. Find the strongest stocks. Once you know what sectors & industries are performing the best, it becomes your job to find the strongest stocks.

Deepvue Makes It Easy To Sort Through ETFs

1. Create an ETF Deeplist

Deepvue continuously creates and updates preset watchlists that you can reference and use as your own. When making a new Deeplist, check out the Presets available to you.

Here is the ETF List we use: ARKF ARKG ARKK ARKQ ARKW ARKX BBH CIBR CLOU DRIV ERX FDN FFTY GDX GDXJ GLD HACK IAT IAU IBB IBLC IBUY IDNA IDRV IEO IGV IHAK IHI IJH IRBO ITB IVW IWM JETS KRE MDY OIH ONLN PAVE PPH QLD ROBO RTH SLV SLX SMH SSO TAN TNA USO XAR XBI XHB XLB XLC XLE XLF XLI XLK XLP XLU XLV XLY XOP XRT MSOS

Use ETF Holdings To Target The Strongest Stocks

2. Sort By Absolute Strength Rating

Deepvue's column settings can be customized to your personal preference. You will want to familiarize yourself with various performance ratings like Absolute Strength and Relative Strength ranked 1 to 99 (99 being the strongest).

We recommend adding the Absolute Strength Rating and sorting by high to low will help you find the strongest sectors and industries quickly.

ETF Holdings in Deepvue

3. Find The Strongest Stocks

Easily discover what stocks are in any given ETF by clicking on the “H” icon next to the ticker. A new list of names appears displaying all the Holdings of that specific ETF. Let's see what this looks like when we click on the “H” next to the ETF SMH.

ETF Holdings sorted by weight

You will now see all the stocks that are in the that ETF. When the new list of names appears, you will also see a new column titled % Holdings indicating the weighting of each stock. If you are trading ETFs and not necessarily looking for individual stocks, this feature will help you see which stocks make up (weigh) the most in that ETF.

The search bar is replaced with the name of the ETF and Holdings. Clicking the X in the search bar will bring you back to the previous Deeplist.

All the stocks are now able to be sorted however you desire. Use your favorite performance metrics to focus on the best performing stocks.

Putting it all Together

Always keep in the back of your mind that the majority of stocks move with the overall market. When a group of similar stocks begin to move in tandem, they will support each other during an uptrend. It is our job to find the strongest stock in the strongest sectors and industry groups.

  1. Curate a Deeplist with only ETFs (Take advantage of Deeplist Presets)
  2. Create a column set that contains your desired performance rankings
  3. Sort ETFs based on recent performance
  4. Click the “H” icon to see what stocks are in the ETF
  5. Now sort the stocks looking for the top movers

Using a top down approach when selecting stocks involves analyzing the overall market, finding the best performing industries, and finally the leading stocks. Look at the bigger picture first, then narrow down your focus.

Concentrate on the strongest industries that are outperforming the market, then identify the leaders in that group.

By utilizing Deepvue's ETF Holdings functionality and performance rankings you will be on the right path to find the strongest stocks using this top down approach.

Similar Posts