Now the economy is rtising, but the best year or two of the stock market are behind us. People who sold thier stocks are now comfortable to get in (they missed the boat). People are find ing jobs again and the news in the paper is good.
- Retail & Travel
Now its time to think ahead to what people will spend their money on. Retail & Restaurants outperform because of consumer spending but the first thing we need is new shoes — these old ones are going in the trash. Clothing & Shoe Makers do well and the headlines make these stocks easy to keep up with.Get into Retail & Travel after the Financials have made thier beginning-of-the-Bull-Market-run. The best time to buy retail stocks is when same-store sales rise. The best same-store sales figures often lead you right to the best stocks. Once we have the clothes, its time for a new car (Autos & Family Homes) and next year we will take a vacation (Travel & Hotels are late-stage investments). Get out of Retail & Travel and into Healthcare and Food & Necessities when the stock market starts to fall. - Energy & Commodities
By now the economy is expanding, people are spending, companies are growing. Raw Materials & Metals are needed for new construction and brand new cars. All this prosperity requires more power. Mining Equipment is used to get the coal, which is burned to create electricity. Oil goes up from higher demand so Oil & Oil Drillers rise. Now that oil is up, newer (more expensive) Clean Energy gets talked up. Think green.Energy & Commodities is the last stop of the economic cycle. The Cheat Sheet stops here. This is the place to be after Technology and Financials have gone up, and get in when Retail & Travel is hot. High energy prices can lead to inflation and either can derail the economy and start the cycle over. This sector is good when inflation is high because these companies are the ones raising prices and profiting from it.
