While major stock indices like the Dow and the S&P 500 are showing nice gains for 2009, the going has been harder recently. Since September, most of those indices have had only slight advances. At the same time, a few sectors have posted much better gains.

As an example, look at the chart below. The black line is daily performance of the New York Stock Exchange Composite. Notice that after peaking in the middle part of September, it has since advanced very little.

By comparison, the other two lines are ETFs representing sectors that have been much stronger. The blue line is SPDR Gold Shares (GLD). Gold is at record highs and has been among the strongest of all sectors over the past month.

The gold line is iShares S&P Latin America 40 Index (ILF). Emerging market funds have done well since early March and they have also moved up strongly during the past three months.

Over the past few weeks we have taken small positions in these funds in some of our strategy portfolios. Our overall feeling about the markets is still that risk is high and investors need to carefully monitor long positions and be ready to sell if there are growing indications of weakness.

We will continue to hold these and a few other select advancing positions until technical indicators deteriorate. But as long as they remain in powerful upward trends we will try to take advantage of the gainful opportunity they provide.

F.S.