Breakout

Two sectors to buy in May before you go away

May marks the start of what is historically the worst six months of the year for owning stocks but Tom Lydon of ETFTrends.com says there’s no need for investors to move their whole portfolio to the beach. In the attached clip Lydon makes the case that energy and utilities are two sectors that offer peace of mind and some tasty yields.

“Energy is the best sector so far this year right next to utilities,” says Lydon. “Both have high dividends and both are poised to keep doing well.”

Far from being scared away from the groups on a valuation or due to potential disruption in Ukraine, Lydon thinks the themes that have driven the groups higher thus far are set to continue. Political unrest could drive energy higher and the stability of yield has been working for those trying to sleep at night in a world going mad.

There’s sure to be more bad news to coming from overseas. As tensions escalate and investors “see drips of sweat coming from our bald brows” it’s going to mean higher prices in store for groups that thrive on global unrest.

Lydon is keeping it simple and thinks the Energy Select Sector SPDR (XLE) and the Utilities Select Sector SPDR (XLU) are the ways to play.

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