“The amount of money being committed to corporate share buybacks lately has been impressive. ... More than 100 companies in the S&P have bought back more than 4% of their shares in the past year alone. The buying hasn’t been limited to just one or two industry groups either; it stretches across most sectors, with the highest concentrations having been in Technology, Telecom and Consumer Discretionary. ... These buybacks have undoubtedly been an important driver for stocks in the last few years. And with nearly $260 billion in buybacks announced so far in 2013 and likely more to come, they should not only keep a floor under share prices going forward, but also contribute further to the market’s advance. ... if you’re interested in capitalizing on stock buybacks, one way to do so is with the Powershares Buyback Achievers Fund (PKW 36.42 NYSE Arca). The ETF mimics the performance of the Mergent Buyback Achievers Index, which tracks U.S. companies that have repurchased 5% or more of their outstanding shares in the previous 12 months. The strategy has proven to be a worthwhile one: since its inception five years ago, the fund has essentially doubled the return of the S&P 500.”
Stephen Leeb, PhD., The Complete Investor, www.completeinvestor.com, 866-833-2070, 6/10/13
