Over the last 18 months, the upswing in the S&P 500 has been driven by the pursuit for yield in this zero interest rate environment. At the end of March, the leaders in the market were the defensive sectors such as telecom, consumer staples, and utilities. However, these sectors experienced such a strong run, our investment committee felt that it was time to take the profits and move on elsewhere.
Our investment committee decided to start selling select winners and slowly begin buying cyclical stocks in technology and industrials sectors that were more attractively valued. They anticipated that there would be a leadership change, propelled by the high valuations in defensive stocks, and that investors would soon begin to move into cheaper sectors in the market.
Read this week’s Thought of the Week to learn more about how you can capitalize on this leadership change.
Click Here for the Weekly Thought As an Investment Advisory Representative working in conjunction with Global Financial Private Capital (GFPC) we are provided weekly thoughts on what is happening in the economy and the market. Written by our investment committee at GFPC we find these thoughts to be informative and interesting.