This is an infrastructure posting presenting the charts for various transportation related companies and ETFs.
In the Dow Theory, you needed both industrials and transports to show an upturn in activity to indicate a confirmed end of a down market and start of a new run higher.
This chart has a few industrial tickers along with IYT, a transportation ETF.
IYT - iShares Transportation Average ETF XAL - Airlines Index. That gold line on the bottom... (NEVER own an airline) SPY - S&P 500 benchmark ETF DIA - Dow 30 "industrials" average (really a broad market ETF) XLI - SPDR Industrials ETF IYJ - iShares US Industrials ETF IPN - SPDR International Industrials ETF
Transports are a very broad group. Generally divided into sea, rail, truck, and air transports. I will not be putting any airlines in this list for now, since I do firmly believe in the dictum “Never Own An Airline!”.
Trade, maybe, days at most… (Fares are limited by the government, bookings by fickle vacation planners and business cost control rules, wage costs are set by the unions, fuel costs by OPEC, and major capital costs for financing are driven by government actions. Exactly what major aspect of it’s business does an airline actually control? Advertising? Not a formula for success…) Realize that I do not put air cargo in the category of an airline. They set their own rates and are not as subject to the whims of vacation planning. FDX and UPS are covered.
For sea born shipping, it divides into vacation cruise lines (RCL and CCL), tankers for various liquids (mostly fuels – VLCCF, TGP, NAT etc.), “dry bulk” that mostly means coal, iron ore, wheat, fertilizer, etc. where the stocks are largely driven by the Baltic Dry Index, and container ships. The Exchange Traded Fund with ticker SEA is an easy way to get a mix, but has not done well lately.
When oil spikes up, shipping drops, and when the economy rolls over and dies, dry bulk sinks. Tankers tend to be more stable, and LNG tankers are on 30 year range leases so their income is very stable (TGP for example) and often have good dividends. Cruise lines vary with the psychology of the middle class (and up) traveling masses…
Broad Shipping comparison
NAT Nordic American Tanker - Burmuda tankers SEA Shipping ETF RCL Royal Caribbean Cruise - cruise ships, Florida USA CCL Carnival Cruise - cruise ships, Florida USA EXM Excel Maritime Carriers - Greek dry bulk VLCCF Knightsbridge - Very large crude carrier - Burmuda DSX Dianna Shipping - Greek dry bulk HRZ Horizon - USA container ships NMM Navios Maritime - Greek dry bulk EGLE Eagle Bulk - USA dry bulk
Canadian and U.S. Rail
Rails is both inside the USA / Canada and part of the complex that moves goods from sea ports inland.
CP Canadian Pacific CNI Canadian National Railway CSX CSX Corp. GWR Genesee Wyoming KSU Kansas City Southern NSC Norfork Southern UNP Union Pacific
Air Cargo vs IYT transport ETF
Generally you only want to own these if they are beating the SPY benchmark.
Early in the business cycle folks are cheap and shipping is by slow means like rail or trucking. Late in the business cycle folks are more flush with cash and in a hurry to get things done. That is usually when air transports outperform.
IYT Transportation basket - ETF FWRD Forward Air Corp. - Greenville, Tennessee UPS United Parcel Service - Atlanta, Georgia AAWW Atlas Air Worldwide - Purchase, New York DDMX Dynamex - Dallas, Texas AIRT Air T - Maiden, North Carolina EXPD Expeditors Intl. Seattle, Washingtion FDX Federal Express - Memphis, Tennessee UTIW UTI World Wide - British Virgin Islands
Out to Sea… Ocean Transports
A sloppy mess that looks sort of bottomed overall, but with a lot of separation between tickers. As usual, RCL / CCL worth more than bulk haulers. Guess hauling rich people around pays more than hauling coal ;-)
I need to add a ‘trucks race’ but that will have to wait until later… They have generally not been interesting for a few years anyway.