Current Market Update

From Cabot Growth Investor

There are never any sure things in the market, but the evidence suggests that the long-awaited sustained uptrend is now underway, which has prompted us to put a bunch of money to work during the past few weeks, helping us land what we think are a few of the true leaders of this rally. Of course, it’s not a perfect picture out there. During the past week or two, we’ve seen the broad market stagnate a bit, with small- and mid-cap indexes lagging (both are still battling multi-month resistance). A few leaders, both growth and cyclical, have hit potholes. And many “overbought” measures are at levels that, during the past few months, preceded multi-week market corrections. Still, we think this is a classic forest vs. the trees type of situation.



    • Thanks for asking. With Top Ten, we usually advise going slow — the market is open every weekday and we’re in touch twice per week (one issue, one Friday update). When sifting through the names, start with the Top Pick, and then look for any new “themes” (could be sectors or niches that are driving some names higher) that emerge, most of which we try to highlight. Then cut all losses short while letting most winners run. In time, you should have a portfolio full of high-performing stocks. Don’t hesitate to email me with any questions along the way.

    • Hi John — I wouldn’t, at least not yet. Market is in a correction, and I have a hunch these stocks that have had giant runs are going to need time at the very least to build new launching pads. Great profit, but now that you’re out of it I’d just wait for a better market/proper entry point.

    • John — well, we tend to follow, not predict, and we’ve been raising cash at a quick pace, though that’s not to say there hasn’t been a ton of damage. That said, if we had bailed ahead of time on prior “corrections” we would have been knocked out of so many winners. It so happens that this decline has been a doozy, but selling everything after 3 bad days isn’t a good long-term strategy.

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