What Is Sector Rotation?
Money moves between parts of the market over time. Sector rotation is that movement. This monitor shows where a fund stands against a benchmark, using two measures: how far ahead or behind it is, and whether that gap is growing or shrinking. Together they usually move a fund clockwise around the chart, though not always. There are two tabs:
- US Sectors: the 11 US sector funds against the whole US market (SPY).
- Asset Classes: stocks, bonds, gold, silver, oil, commodities, real estate and cash against world stocks (ACWI).
Each fund lands in one of four quadrants:
- Leading (top right): beating the benchmark, and the lead is growing.
- Weakening (bottom right): still ahead, but the lead is shrinking.
- Lagging (bottom left): behind the benchmark, and falling further.
- Improving (top left): still behind, but catching up.
What it doesn't tell you
A quadrant isn't a trading signal. It describes what has already happened, compared with the benchmark. A fund can be Leading while its price falls, if the benchmark falls more, and Leading doesn't mean it's the best time to buy.
How It's Calculated
Using each week's last closing price, the relative line is the fund's price divided by the benchmark's. Then:
The averages are exponential, so recent weeks count more. Above 100 on Relative Strength means the fund is ahead of its own one-year relative trend. Above 100 on Relative Momentum means that reading is rising. The latest point uses the newest close, so it can change until the week ends. Prices don't include dividends, so funds that pay out much of their return, such as bond funds, look weaker than they really were. This is our own version of the idea, so it won't match other charting services exactly.
What History Shows
These tables look at every fund, every week, and ask what happened next. Each number is the fund's price return minus the benchmark's over the following months, averaged across all the weeks in that row. Compare a row with All weeks at the bottom of its table, not with zero, because that line shows how the funds did on average, whatever quadrant they were in.
US Sectors vs SPY
Mar 23, 2012 to Oct 30, 2026, 11 funds.
| After | Fund weeks | Next 1 mo. | Next 3 mo. | Next 6 mo. | Ahead after 3 mo. |
|---|---|---|---|---|---|
| Leading | 2,014 | -0.37% | -0.91% | -1.36% | 46% |
| Weakening | 1,198 | +0.10% | -0.27% | -0.67% | 49% |
| Lagging | 2,742 | -0.22% | -0.41% | -1.15% | 45% |
| Improving | 1,824 | -0.07% | -0.80% | -1.63% | 44% |
| Improving to Leading | 162 | +0.01% | -1.39% | -2.50% | 43% |
| Leading to Weakening | 235 | +0.19% | -0.26% | -0.40% | 46% |
| Weakening to Lagging | 134 | +0.03% | +0.13% | -0.55% | 47% |
| Lagging to Improving | 352 | -0.27% | -0.60% | -1.55% | 44% |
| All weeks | 7,778 | -0.17% | -0.61% | -1.24% | 46% |
Over the next three months, funds in Leading averaged -0.91% against SPY, funds in Lagging averaged -0.41%, and all weeks averaged -0.61%.
Asset Classes vs ACWI
Mar 23, 2012 to Oct 30, 2026, 12 funds.
| After | Fund weeks | Next 1 mo. | Next 3 mo. | Next 6 mo. | Ahead after 3 mo. |
|---|---|---|---|---|---|
| Leading | 1,690 | -0.18% | -1.06% | -0.99% | 44% |
| Weakening | 1,020 | -0.50% | -0.75% | -0.81% | 48% |
| Lagging | 3,295 | -0.54% | -1.46% | -3.45% | 37% |
| Improving | 2,537 | -0.40% | -1.62% | -3.73% | 37% |
| Improving to Leading | 150 | +0.23% | -1.59% | -3.58% | 42% |
| Leading to Weakening | 170 | -0.25% | -0.20% | +0.11% | 46% |
| Weakening to Lagging | 119 | +0.80% | +1.50% | +0.87% | 49% |
| Lagging to Improving | 429 | -0.82% | -1.66% | -4.51% | 36% |
| All weeks | 8,542 | -0.42% | -1.34% | -2.73% | 40% |
Over the next three months, funds in Leading averaged -1.06% against ACWI, funds in Lagging averaged -1.46%, and all weeks averaged -1.34%.
Ahead after 3 mo. is the share of those weeks when the fund had beaten the benchmark three months later. A row such as Improving to Leading counts only the week a fund crossed over, so it has far fewer readings and can swing more.
Read these with care. A fund's neighboring weeks overlap, so there are far fewer independent results than the counts suggest. Prices leave out dividends, trading costs and taxes. Not every fund existed for the whole period, and the most recent months aren't counted in the longer columns, because what came after them isn't known yet. The results describe one stretch of history and don't predict future returns.
How to Use the Sector Rotation Monitor
- Tabs: switch between US Sectors and Asset Classes.
- Chart: each dot is a fund with its own color, and its tail shows the last 5 weeks, getting thicker toward today. Tap a dot to pick it out.
- Timeline: click Play, or drag the slider, to watch the past year unfold.
- Quadrant cards: which funds are in each quadrant at the week shown.
- Leaderboard: every fund ranked by Relative Strength or Relative Momentum. Click a heading to re-sort.
- Rotation history: each fund's quadrant over the last 4, 8 or 12 weeks.
- Share: the Facebook and X buttons share this page with a picture of the latest chart.
For information only. This is not investment advice, and past patterns don't predict future returns.