After selling into year-end market strength to close out the year, net weekly net insider trading transactions (the number of individual buyers minus sellers) has finished January on a slightly positive note, as many insiders appear to have taken advantage of the market weakness to increase their net holdings.

The defensive posture taken by Sabrient’s fundamentals-based SectorCast-ETF model has allowed the long/short model portfolio to prosper in the face of the market weakness we’ve seen over the past week. The formerly hot Materials sector had begun to show signs of cooling off last week even as the overall market was hitting new highs, and over the past week it fell hard.

Two exchange-traded funds that track Sabrient quantitative indexes passed their 3-year anniversaries in late 2009 and received prestigious 4-STAR Morningstar ratings.

The Claymore/Sabrient Insider ETF (NYSE Arca: NFO) and the Claymore/Sabrient Defensive Equity ETF (NYSE Arca: DEF) track the Sabrient Insider Sentiment Index (SBRIN) and Sabrient Defensive Equity Index (SBRDE), respectively.

Although the market is flashing signs of a strong breakout for the New Year, Sabrient’s SectorCast-ETF model continues to flash defensive signals. Given the quantitative model’s reliance on value-based fundamentals, this shouldn’t be surprising after such a lengthy and sustained rally. This week, there are few changes to the sector rankings. Most notable is the continued rise in Energy, which now scores a 62 but hasn’t yet cracked the Top 2.

As the stock market continues to trade at 15-month highs, Sabrient’s SectorCast-ETF model is getting even more defensive, even though we are in a historically bullish time of year. The fundamentals-based quantitative model has a GARP (growth at reasonable price) focus, and this week there are significant changes to the sector rankings.

Just a quick update while I'm on vacation this week.