Keith Richards, president and chief portfolio manager, ValueTrend Wealth Management
FOCUS: Technical analysis
Top Picks: iShares 20+ Year Treasury Bond ETF, Ishares Msci Brazil ETF, Atkinsrealis Group
MARKET OUTLOOK:
In my last show, I noted in the opening notes that ValueTrend owns almost no tech (we hold one two per cent position in a software company that is not an AI play). It’s been overvalued for much of the year, but in June I began blogging to my readers that it was in grave danger of a pullback. Sentiment and technical studies focusing on the Nasdaq in general, and the Magnificent Seven specifically, were indicating an overbought market, and here we are.
There’s no doubt about it that the market is starting to shift away from tech and into value plays. Just a few to name here, we are seeing a move into small-capped stocks. We are also seeing a strong move into emerging markets, which was a top pick on my last show. We are seeing financials, real estate, defensive stocks (staples, utilities, healthcare) along with select materials and industrials showing CRS (comparative relative strength) against the tech-heavy indices. As I’ve noted in my blogs since June, “anything but tech.”
We’ve continued to hold about 25 per cent cash in our equity models as we have for the summer. And we’ve not budged from our premises of an overbought tech sector. We’re not saying that tech is dead; it is not. We want to buy in again, but we think the seasonal factors of August-September may see markets waver, and tech stocks may be the more volatile sector if this happens. During election years October tends to be a positive month, so we anticipate spending much of our 25 per cent cash over the coming two months as opportunities present themselves. Including, if the charts dictate, a renewed interest in the tech sector.
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TOP PICKS:
iShares 20+ Year Treasury Bond ETF (TLT NASD)
Ishares Msci Brazil ETF (EWZ NYSEARCA)
Atkinsrealis Group (ATRL TSX)
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| TLT NASD | Y | Y | Y |
| EWZ NYSEARCA | Y | Y | Y |
| ATRL TSX | Y | Y | Y |
PAST PICKS: MAY 21, 2024
Hershey (HSY NYSE)
- Then: US$207.35
- Now: US$195.52
- Return:-6%
- Total Return: -6%
Global X Silver Miners ETF (SIL NYSEARCA)
- Then: US$35.79
- Now: US$34.30
- Return:-4%
- Total Return: -4%
BMO MSCI China ESG Leaders Index ETF (ZCH TSX)
- Then: $14.53
- Now: $13.38
- Return:-8%
- Total Return: -8%
Total Return Average: -6%
| DISCLOSURE | PERSONAL | FAMILY | PORTFOLIO/FUND |
|---|---|---|---|
| HSY NYSE | Y | Y | Y |
| SIL NYSEARCA | Y | Y | Y |
| ZCH TSX | Y | Y | Y |