The New Leaders
I am a believer in the concept that the leaders in a New Market phase are defined by which stocks do well during a bottoming process. That is what we have been following since the May 11th lows set the stage for the bottom. While I don’t want to be viewed as a stock picker, this is a unique situation where the basket of stocks that have screened out are on average down 76 percent from their highs plus they have shown relatively strong performance during the bottom.
For me the interesting part is that the stocks that have screened out fit the story that I see for the next phase of the markets. Interestingly, the one person that I think it will pay to watch is Cathie Wood. She is the one who has keyed in on innovation but whose stock picks got caught up in the free money frenzy of the past few years and consequently got ahead of themselves.
I will talk about this more in the coming months. We have done a lot more research of the stocks that fit the Bio / EV / Core Tech / criteria. The easiest way to play the concept is to use the ARKK and ARKG ETF’s, however these ETF’s contain some stocks that I don’t conceptually agree with for the coming phase, like stocks in gaming, crypto, etc. Putting this all together and bringing in stock names that do not appear in Cathie’s ETF’s I am looking at the following breakdowns for my trading. You will note I am generally avoiding consumer related names as well as TSLA.
ARKK, ARKG, ZM, CRWD, SNOW, MSFT, SMH, NVDA
RIVN, QS, PLUG, NIO, BLNK, LCID
PATH, TDOC, BEAM, PD, TXG, TWST, BLI, CGEN, NTRA, FATE SGFY, VCYT, CERS, IONS, VRTX, INCY, MRNA, VIR, GILD
And, not to forget the 30 % I place in general market long side trading……….
SPXL and TQQQ