Strong Hands … or Strong Paws!
Longtime Profits Unlimited subscriber Mark wrote that he and his family have weathered all the market storms with Strong Hands and that my dog Alex shows him how.
“We have breathing room and a future thanks to you and your team.
When the market is up … Alex doesn’t get too high and when the market is down, I can see him calm as a windless day back there behind Amber.”
Way to go, Mark! Sounds like you’ve mastered an important Bold Profits strategy: Strong Hands. And I want to share the importance of this lesson with everyone else.
Over the last few weeks, the markets have been volatile.
Last year presented an enormous stock trading opportunity starting in March. Since that V-recovery, stocks basically went up uninterrupted. Now, we’re seeing it normal out.
Paul and the team are still very much #BOP (bullish, optimistic, positive) on America 2.0 stocks.
What we’ve witnessed in recent weeks is simply stock profit-taking.
Investors have made huge gains over the past year and are now selling some shares to buy other stocks.
I’ll tell you all the signs that point to a healthy economy. Turns out, Alex and his Strong Paws are a great indicator! I’ll also reveal what Paul is calling the most bullish scenario you could ever have for the stock market.
Say Bye to FANG — Our New Market Will Dominate
After this last sell-off, we actually have a much healthier market.
You can see that by tracking the Invesco S&P 500 Equal Weight ETF (NYSE: RSP) vs. the SPDR S&P 500 ETF Trust (NYSE: SPY).
Basically, you’re seeing the RSP’s equal weight vs. SPY’s market cap weight in the S&P 500 Index.
As seen in the chart below, since the broad market peak on February 16, 2021, RSP is outperforming SPY:
When RSP performs better than SPY, it confirms a healthier market for buying opportunities in smaller cap America 2.0 stocks.
In our recent investment team call, Paul framed this comparison this way:
Between 2016 to 2019 or so we had a pretty healthy market. We made some money, here and there, but having just six or seven large cap stocks carry the broad market, represented by big companies like Apple, Microsoft, and FANG (Facebook, Amazon, Netflix and Google [Alphabet]), was problematic.
The moment these large cap stocks stopped going up it took the entire market trading platform away.
Today, we have a lot more stocks participating. You can look at the number of 52-week highs and lows. Even with the current market rout happening you can see there’s a lot of 52-week highs being made. This means there are still enough stocks seeing demand pressure to force people to pay to get in.
From our perspective, this is still a healthy market. Small cap America 2.0 stocks are going to see more buying and inflows as investing dollars shift away from large cap stocks.
The FANG market is over. But we have a much healthier market, especially for our America 2.0 and Fourth Industrial Revolution focused stocks.
So, you see, opportunities among our America 2.0 stocks are overflowing. And there’s one area we’re super bullish on…
Most Bullish Scenario for Your Portfolio
Manufacturing is about to see a historic boom.
It’s going to underpin future growth for our stocks and meet greater economic demand.
In 2020, Paul coined a phrase called the 3Rs.
The 3Rs stand for Restock, Reinventory and Reshore.
The 3Rs reference the current phenomenon that entire categories of products are being sold out across the U.S. and are not being replaced fast enough, hence the need to restock and reinventory.
We also believe that for the U.S. to begin manufacturing more goods, it will turn to America 2.0 technology — like 3D printing — rather than importing goods from other countries.
[You can see how 3D printing will remake (another R!) the factory floors right here in America by checking out Paul’s new presentation here.]
This manufacturing shift is known as reshoring.
See, right now, the world has an inventory problem. We don’t have enough goods to meet people’s demand.
Paul sees this as the most bullish scenario you could ever have for the stock market.
Demand is the magic thread, for anything.
This is what all economies and companies desire: real demand.
And today I’m happy to report, Paul’s “3Rs” forecast is spot-on!
The Fundamentals for Our U.S. Economy are Strong
February’s U.S. manufacturing expanded at the fastest pace in three years.
These manufacturing sector gains show a robust and resilient sector that will help power the America 2.0 economy.
This manufacturing demand is also translating to the fastest annual advance for U.S. gross domestic product (GDP) forecast in 32 years!
The Atlanta Fed’s GDPNow model forecasts a huge jump in U.S. GDP ahead … potentially, “the FASTEST annual advance by U.S. nominal GDP since 1989.”
What all this means is now is a great time to remind you of our Strong Hands mantra.
Through market volatility and downturns, it’s imperative to keep Strong Hands. Market dips are normal. But our core strategies are holding strong in our stocks.
And we see nothing but GROWTH ahead.
We’re even seeing evidence of your Strong Hands! Check out this Bloomberg chart, titled “Buy the Dip.”
It shows how investors are undaunted by recent stock market volatility.
This chart shows investors scooped up equity ETFs during the recent pullback:
Per Bloomberg, ETFs saw consistent inflows including $2.7 billion on February 25, 2021. Also, ETFs added $80 billion in February which is four times its 12-month average.
So, take a note from Mark and Alex.
Continue to weather market storms with Strong Hands. As long as our strategy remains unshaken, you can aim to be as calm as a windless day through any volatility.
Until next time,
Director of Investment Research, Banyan Hill Publishing
P.S. Remember, Paul believes: The FANG market is over. Small cap America 2.0 stocks are going to see more buying and inflows as investing dollars shift away from large cap stocks.
In this healthier market, you have an opportunity to invest in the small-cap leaders of the Fourth Industrial Revolution. Paul’s small-cap strategy targets stocks with 1,000% potential.
Don’t miss his next big trade (like our best one that readers closed at a 1,142% gain after three and a half years). One open position is teetering at 985% after one year right now. And in this market, more could be just around the corner. Click here for all the details.