Avoiding the Eye of the Storm
As markets transition from a period of technology dominance and into areas that benefit from rebuilding the western world, we have rotated the portfolio into companies that make up the nuts and bolts of the western economy. Many of these companies’ stock prices have done nothing for the better part of a decade while slowly building up their earnings and cash flow base. If the technology sector has indeed peaked, we expect energy, industrials, financial and material stocks to be the prime recipient of these fund flows.
In the short term, markets took a punch to the gut over the past week as investors fret over the violent selloff in technology, the impact of the Colonial Pipeline hack, and of course, the threat of higher inflation. While geopolitical events can hurt markets over the very short term, their long-term impact on an investor’s growth trajectory is moot at best. As it relates to inflation, rising prices are the result of supply chain disruptions caused by the COVID shutdowns. These factors appear transitory in nature and should normalize as bottlenecks are resolves throughout the year.
- Stock remain the most attractive asset class on a relative valuation basis
- Energy stocks are trying to emerge from a ten-year hibernation
- The 80% rise in volatility over the past three days appears capitulatory in nature → short term bullish
The information here is presented by licensed professionals and not specific to any individual’s personal circumstances. Investment advisory services offered through LifePro Asset Management, LLC, a registered investment adviser. Investments involve risk and are not guaranteed. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment or investment strategy will be profitable or equal any historical performance. Discussion of any specific stocks are based on objective, non-performance criteria and such discussion neither serves as a recommendation nor as the receipt of, or a substitute for, personalized advice. Due to various factors, including changing market conditions, such discussion of positions and/or recommendations may no longer be reflective of current position(s) and/or recommendation(s). Moreover, no client or prospective client should assume that any such discussion serves as the receipt of, or a substitute for, personalized advice from Advisor, or from any other investment professional. Forward-looking statements such as “anticipate,” “believe,” “estimate,” “expect,” “intend,” “plan,” are based on management’s views and assumptions at the time such statements were originally made and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. LifePro Asset Management does not undertake any obligation to correct or update any forward-looking statements on the LPAM Site.