My Top Five Stocks Right Now
Here's where I plan to buy the dip...
Do you remember the mood going into 2024?
Most investors did not expect the bull market in stocks to continue. In fact, Wall Street estimates had their weakest outlook for the S&P 500 in a decade.
Yet we decided to keep buying stocks and other risk assets, which was the right move as it's been a great year for financial assets:
S&P 500 +19%
Gold +22%
Bitcoin +40%
Nasdaq +17%
Russell 2000 +10%
And while it may surprise some of you, I expect this bull market to keep chugging along.
Bull markets don't die of old age. They are typically killed by the Federal Reserve, which is what happened in 2022 when they raised interest rates at their fastest pace since the 1970s. Considering the Federal Reserve is about to lower interest rates and has ended quantitative tightening, we're in the exact opposite scenario.
That said, we're entering the worst part of the year for market "seasonality." While I don't put too much emphasis on how markets perform during certain times of years, it's something I don't ignore either as the data is fairly clear about how poor stocks do in September.
I view any upcoming dips - even ones of 7%-10% for the S&P 500 - as buying opportunities.
Remember that volatility is the price we pay for higher returns. And while the next few months are historically bumpy, it's important to not flinch when we get pullbacks. That said, I am going to open a small hedge for my tech stocks.