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Two Stock Market Segments Offering Good Value
July 17, 2014 at 19:00 PM EDT
As evident in last Thursday’s European-bank related market jitters, today’s stretched valuations and low market volatility leave stocks vulnerable to bad news, even when the news is relatively minor as was the case last week. And equities in the more expensive market segments are particularly vulnerable. Case in point: U.S. small caps, biotech and Internet stocks suffered the most last week, and these are among the areas of the market where stock performance is most outpacing fundamentals. So, while I still prefer stocks over the alternatives, I’m an advocate of a value bias. In other words, I suggest investors consider emphasizing select market segments that offer good relative value and potential downside protection. Where can one find this value? As I write in my latest weekly commentary, “With Stocks Vulnerable, Think Big (Cap) for Value,” I’d suggest focusing on two market segments. U.S. large- and mega-cap stocks. U.S. large- and […] Click here to read the original article on ETFdb.com. Related Posts: No Related Posts
As evident in last Thursday’s European-bank related market jitters, today’s stretched valuations and low market volatility leave stocks vulnerable to bad news, even when the news is relatively minor as was the case last week. And equities in the more expensive market segments are particularly vulnerable. Case in point: U.S. small caps, biotech and Internet stocks suffered the most last week, and these are among the areas of the market where stock performance is most outpacing fundamentals. So, while I still prefer stocks over the alternatives, I’m an advocate of a value bias. In other words, I suggest investors consider emphasizing select market segments that offer good relative value and potential downside protection. Where can one find this value? As I write in my latest weekly commentary, “With Stocks Vulnerable, Think Big (Cap) for Value,” I’d suggest focusing on two market segments. U.S. large- and mega-cap stocks. U.S. large- and […]
