The first chart (click to enlarge) is that of the ratio XHB over SPY, in other words the performance of the homebuilders ETF relative to the S&P 500 ETF. It caught my attention because here is a much-hated sector that has pretty much been building a base since early 2008.
If, instead of comparing the homebuilders to the S&P 500, we compare them to another despised sector, the financial sector (represented by XLF) as shown in the second chart (click to enlarge), we can see XHB outperforming XLF handily since 2008.
So, if you believe that today's most hated stocks will one day have their day in the sun, XHB might not be a bad ETF to have in your portfolio.
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