Rotation, Rotation, ..., How much Longer
SPX Cap-Weighted vs Equal-Weight – Cycle Analysis
The cycles of the SPY / RSP ratio have done a great job forecasting the relative performance of SPY versus RSP, which led me to suggest 2+ months ago a rotation from momentum big-cap stocks into the broader market.
Over the past couple of months, SPY has underperformed due to weakness in semis/AI, while the broader market remained relatively strong.
According to cycle analysis, RSP (and the broader market) is now expected to underperform until around Oct '26.
