Agriculture stocks have performed poorly in 2016. As of early November, the PowerShares DB Agriculture Fund (DBA) is down 0.44% year-to-date, significantly underperforming the S&P 500 (4.02%). This on the heels of 2015 when the DBA was more than 16% lower than the S&P 500. Trendrating’s Smart Momentum analytics explores momentum within U.S. agriculture stocks. “Grading out” shows the current distribution of momentum among U.S. agriculture-focused stocks.
The majority of stocks in the sector have a positive rating and have been trending upwards in the last three months. More interestingly, we see the dichotomy in performance between positively and negatively rated stocks. It can be argued that while this sub-sector has been flat so far this year, there have been a lot of trends within the sector that the Trendrating Smart Momentum Model was able to capture.
To better illustrate this point, below are charts of the best performing positively rated stocks and worst performing negatively rated stocks in this sector (see “Ag winners & losers”). These charts display timing of issued ratings and subsequent performance.