There's no rest for the whipsawed. With 2012 coming to a close it's time for investors to start looking for opportunities in the New Year. To help do so, Jeff Kilburg, founder & CEO of KKM Financial, took a look into his crystal ball to tell us what he sees.
In the attached clip Kilburg offers two sectors and a wildcard stock pick to consider adding to your portfolios.
Kilburg has two ways he thinks energy wins. First, the "race to debase" going on around the world will mean higher prices for all commodities, including crude oil. Slightly more questionable, Kilburg thinks the stimulus happening around the world will eventually result in organic demand, also driving up prices.
Throw in a little underlying global tension and Kilburg has his thesis. In the video he ticks through some of the usual gang of individual names but says individual investors don't need to over think it. Rather than buy all the stocks, he suggests the Energy Select SPDR (XLE) which he says could see a "nice boom" next year.
Regional Banking (KRE):
While the big banks get all the attention, they also come with unknown European exposure and a regulatory environment in which nothing ever happens but it always seems threatening.
The regional banks more clearly benefit from a steep yield curve as it allows them to lend money with a larger margin of error in terms of their profit model. By going regional Kilburg takes Europe out of the equation. Additionally "we're seeing the long end of the curve uptick" which should, at least in theory, make these smaller banks more profitable. Kilburg says the trade is getting long SPDR KBW Regional Banking ETF (KRE).
The Wild Card Pick: LeapFrog (LF)
Here's your wildcard stock and it's a doozy. As most parents know LeapFrog makes educational toys and devices for kids. The company has been a constant through all the changes in handheld devices since 1995 when it was founded. Its LeapPad tablet device actually teaches kids something, putting the stock in prime position to rise, according to Kilburg.
This makes them one of the few device makers with largely undeveloped competition in the kid arena.