Advice for investing at record highs, including a 7-part stock-picking model
Hello everyone! Welcome to this weekly roundup of Investing stories from deputy editor Joe Ciolli. Please subscribe here to get this newsletter in your inbox every Tuesday.
Dear Readers,
The stock market is sitting at record highs. So why does it feel like the party's already dispersing?
It could be the recent measured skepticism from firms like Morgan Stanley. While chief US equity strategist Mike Wilson isn't ready to predict another bear market, he did recently say that three conditions in particular could combine to spur a near-term correction.
JPMorgan has also joined in the lukewarm chorus, with strategist John Normand recently outlining what could trigger a bond-market sell-off that could threaten stocks. The implications of such a shift would bleed into everything from equities to gold — a situation that has Normand urging traders to hedge.
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Also within JPMorgan is Eduardo Lecubarri — the firm's global head of small and mid-cap equity strategy — who predicts a rangebound stock market for the next year. But while his market-wide forecast is largely neutral, Lecubarri still sees select investing opportunities. He recently laid out 11 regions and sectors poised to outperform.
The Investing team at Business Insider is closely monitoring these shifting views to help you figure out how to excel in any market environment. See below for our best stories of the week, including a wide array of recommendations, strategies, and tips for navigating uncertainty.
Thanks for reading!
-- Joe
A 7-part model for picking winning stocks from a market wizard
William O'Neil, the legendary trader and author of "How to Make Money in Stocks," described his "CANSLIM" trading methodology in Jack Schwager's "Market Wizards" series.
After he grew frustrated with the advice and techniques being pitched through investment letters, O'Neil set out to develop his own strategy for spotting the market's next big winners. He famously turned $5,000 into $200,000 from just a handful of trades, according to Schwager.
Read the full story here:
Stock-market wizard William O'Neil famously turned $5,000 into $200,000 in just a few years. Here's the 7-part model he uses to sniff out winning stocks.
5 post-pandemic stocks to buy right now
Crossmark Global Investments' Victoria Fernandez shared with Business Insider five stocks she's recently added to her portfolio, as she sees them positioned to rebound alongside the economy. She also said she's trimming some big tech names as the economy begins to recover.
Read the full story here:
A $5 billion chief market strategist shares 5 post-pandemic stocks to buy now for gains as COVID-19 cases level off — and 2 big-tech winners to start cashing out of
Solving America's problems with investing legend Joel Greenblatt
Joel Greenblatt — the managing principal and co-chief investment officer at Gotham Funds — proposes a wide range of solutions to systemic issues that have stymied growth and deepened the chasm between the haves and have-nots in the US.
In his new book, "Common Sense: The Investor's Guide to Equality, Opportunity, and Growth," the famed investor channels facets of the philosopher Thomas Paine. Greenblatt focuses on education, immigration, and social security, and proposes timely solutions.
Read the full story here:
Warren Buffett disciple Joel Greenblatt averaged 50% annual returns over 10 years. He shares an investor's approach to solving some of America's most glaring problems right now — from education and immigration to social security.
Stock pick central
Seeking experts who are willing to name names? Look no further:
- MORGAN STANLEY: Buy these 22 stocks that are slashing costs as sales take a hit from COVID-19 — putting them in position to smash the market as the economic recovery continues
- Jefferies says buy these 7 back-to-school stocks poised for big returns with much of the US going remote
- RBC says buy these 48 stocks spanning every industry that are poised to crush the market if Donald Trump wins reelection
- RBC says buy these 47 stocks spanning every industry that are poised to crush the market if Joe Biden wins in a wave election
Take control of your financial future and learn how to develop an investment strategy that works for you by attending "How to Be a Smarter Investor Now" on Tuesday, September 15 at 12 p.m. ET. The event is part of Business Insider's Master Your Money Live Digital Bootcamp series, presented by Fidelity.
Chart of the week
The chart above shows the historical price reaction for a wide range of asset classes following a sharp sell-off in developed-market bonds. Those returns — and losses — dictate JPMorgan's strategy for how to play such an unexpected event.
Click here for more details
Quote of the week
"Forty percent of SMID caps are not pricing in much of anything. That's where the opportunity lies. The performance asymmetry that you've seen during this whole COVID-related downturn has been huge."
— Eduardo Lecubarri, the global head of small- and mid-cap equity strategy at JPMorgan Chase, discussing where to find returns in the stock market right now