|Bid||144.49 x 1200|
|Ask||144.41 x 1100|
|Day's Range||143.24 - 145.60|
|52 Week Range||95.69 - 170.56|
|PE Ratio (TTM)||N/A|
|YTD Daily Total Return||-12.42%|
|Beta (5Y Monthly)||1.27|
|Expense Ratio (net)||0.19%|
Small-capitalization stocks have been the darling of Wall Street of late, with some analysts predicting recent action as the beginning of the end of a yearslong bear market while others warn that these riskier shares could disappoint yet again if a robust economic recovery fails to materialize.
Each week I try to identify a key theme that defined the movement in stock prices over the past 5 days. But unlike many investors, my searching isn't based on news, it's based on price.The charts tell the tale, if investors are keen to listen. This week's exercise revealed clear rotation going on beneath the market's surface, and directed me to these top trades for your consideration.The first part of the shift was money flowing out of leaders and into laggards. Large-caps have long been leading the market recovery, while small-caps have lagged.InvestorPlace - Stock Market News, Stock Advice & Trading TipsBut not this week! The switcheroo saw little guys pick up the torch and lead their bigger brethren to victory. As of Thursday's close, the S&P 500 was only up 3% but the iShares Russell 2000 ETF (NYSEARCA:IWM), which represents small-caps, was up 7.3%.The second shift is partially related to the first. Stocks benefiting from the novel coronavirus saw profit-taking while economically sensitive equities (like small-caps) surged. That's a welcome development that points to risk appetite continuing its return. * 7 Excellent Penny Stocks Ready to Roar Here's the silver lining. If you've been waiting for a dip before buying companies outperforming during the Covid-19 crisis, then here's your chance. These three stocks have attractive setups that make them top trades for the week: * Netflix (NASDAQ:NFLX) * Citrix Systems (NASDAQ:CTXS) * Newmont Mining(NYSE:NEM)Let's take a closer look at their respective pullbacks and build trades to profit. 3 Top Trades for the Week Ahead: Netflix (NFLX)Source: The thinkorswim® platform from TD Ameritrade Netflix is the type of no-brainer stock that should leave investors who didn't buy during the March crash kicking themselves. NFLX was bound to do well during a time when content-hungry consumers were ordered to stay home.Netflix was one of the first stocks to recover and has since gone on to record highs. This week's rotation saw profit-taking strike the streaming king even as the rest of the market rallied.The pullback tested the rising 20-day moving average and held on Thursday. But even if the stock dips further, I think you have to view the weakness as a golden opportunity to get in on one of the top trades in the market at lower prices. Since it's always wise to have a plan in case you're wrong, I suggest watching $400 or the 50-day moving average as your line in the sand. If we push below that, then I'd change my bullish tune.Its higher price tag makes NFLX stock a great candidate for bull put spreads. We can create a wide profit zone in case the retreat continues before buyers emerge.The Trade: Sell the June $395/$300 bull put spread for around 90 cents. Citrix Systems (CTXS)Source: The thinkorswim® platform from TD Ameritrade Citrix Systems has been among those tech stocks seriously benefiting from the work from home trend. Its share price was up 40% year-to-date before the recent drop.This week's selling did inflict damage to the overall trend by jamming shares below the 50-day moving average. It's the deepest retreat we've seen in CTXS since March, so I suspect some would-be buyers are hesitant.The reason I don't mind putting money to work here is twofold. First, we can wait for the stock to return above the 50-day before pulling the trigger. That will invalidate the breakdown and return CTXS stock to a healthy status.Second, the underlying themes driving CTXS haven't changed this week. And that makes me believe this is a simple correction, rather than the beginning of a trend-ending sell-off. We can deploy a strategy that gives the stock some room to flounder and still profit. * 7 Excellent Penny Stocks Ready to Roar The Trade: Sell the June $125/$120 bull put spread for 70 cents. CTXS options aren't that liquid, so you must use limit orders. Newmont Mining (NEM)Source: The thinkorswim® platform from TD Ameritrade Gold and gold stocks have been on fire this year. Economic upheaval and the printing of trillions of dollars is breathing new life into the bullish thesis for owning precious metal related products. And the Vaneck Vectors Gold Miners ETF (NYSEARCA:GDX) has more than doubled from March lows.As one of the largest players in the space, Newmont Mining has been riding the rising tide. It even came within a whisper of all-time highs, which is incredible given that the sector fund (GDX) is still 50% off its peak.NEM stock's leadership makes it a top trade pick if you're looking for exposure to the yellow metal. Buying an outperforming stock in an outperforming sector means you're betting on the strongest possible candidate.This week's rotation saw profit-taking strike and is creating a classic buy-the-dip opportunity. Every pullback this year has been a great chance to buy, and I see no reason why we should view this one differently. If you want to increase your odds of success, I like selling naked puts. You're essentially getting paid for your willingness to acquire the stock.The Trade: Sell the June $60 put for around $1.45.For a free trial to the best trading community on the planet and Tyler's current home, click here! As of this writing, Tyler didn't hold positions in any of the aforementioned securities. More From InvestorPlace * Top Stock Picker Reveals His Next 1,000% Winner * America's Richest ZIP Code Holds Shocking Secret * 1 Under-the-Radar 5G Stock to Buy Now * The 1 Stock All Retirees Must Own The post 3 Top Trades As We Head Into the Last Week of May appeared first on InvestorPlace.
With equities on the ropes this week, it's time we looked at the best bear trades to bank on for the next market drop.The stock rebound since March has been violent. Its duration and magnitude have caught many traders by surprise, particularly those obsessing over the grim economic data. That said, trying to reconcile rising asset prices on Wall Street with the warzone on Main Street has generated more than a little cognitive dissonance.However, spectators convinced that the chickens would eventually come home to roost are seeing their forecast play out this week. Stocks are falling anew, especially in the most economically sensitive areas like small-caps.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 20 Stocks to Buy If You're Still Betting on America to Thrive So, rather than try to pick which individual stocks, we're focusing instead on playing the weakest industries. There are many to choose from, but here are three underperforming ETFs that look particularly vulnerable: * iShares Russell 2000 Index ETF (NYSEARCA:IWM) * SPDR S&P Banking ETF (NYSEARCA:KRE) * SPDR S&P Oil & Gas Exploration & Production ETF (NYSEARCA:XOP)Let's break down the charts of each, and build high reward bear trades on each. High Reward Bear Trades: iShares Russell 2000 Index (IWM) Click to EnlargeSource: The thinkorswim® platform from TD Ameritrade If you find the Nasdaq Composite ETF (NASDAQ:QQQ) index a stone's throw from all-time highs a bit quizzical given the horror show that is the economy right now, then it's because you're looking at the wrong basket of stocks. While tech mega-caps have found themselves largely insulated from the nasty price action, small-caps have not; They've born the brunt of the damage.From peak-to-trough, the Nasdaq Composite ETF only fell about 30%. By contrast, the Russell 2000 Index was down 41%. And though the selling pressure eased through the back half of March and all of April, the relative weakness remained. Currently, QQQ is only 7.5% off its peak, but IWM is off by 26.5%.Moreover, the rationale for small-caps' weak ways is simple: They're more sensitive to economic downturns. With this week's whack, IWM now sports a lower-swing high and lower low. Though it rallied back by day's end, it also pushed below the 50-day moving average. Wednesday's slide was particularly ugly, with volume swelling past 58 million shares.If you're willing to bet the downturn returns IWM close to March's low over the coming two months, then here's a trade that will deliver big returns:The Trade: Buy the July $105/$100 bear put spread for around 90 cents.You're risking 90 cents to make $4.10 if IWM falls to $100. SPDR S&P Banking ETF (KRE) Click to EnlargeSource: The thinkorswim® platform from TD Ameritrade One of the industries weighing on small caps has been regional banks. The specter of a deep recession caused investors to flee KRE throughout February and March. Ultimately, the fund fell 52% from 2019's peak before a bottom was found. But the bounce-back has been meager compared to the robust buying elsewhere.What's worse, this week saw KRE crack support and tumble below its 20-day and 50-day moving averages. Momentum increased during the downswing to confirm sellers have returned to power. Thursday's session is giving bulls some hope but it's going to take more than a single session of strength to right this hole-ridden ship.If you think we ultimately return to March's levels of $27, then this bear trade offers a smile-inducing payout.The Trade: Buy the July $30/$27 bear put spread for around $1.00. * 5 High-Quality Company Stocks to Buy For Less Than $10 You're risking $1 to make $3 if KRE sits below $27 at expiration. SPDR S&P Oil & Gas Exploration & Production ETF (XOP) Click to EnlargeSource: The thinkorswim® platform from TD Ameritrade The final spot ripe for bear trades is the energy sector. Specifically, we're focusing on the Oil & Gas ETF, XOP. It's performed far worse than the Energy Sector ETF (NYSEARCA:XLE) in large part because it lacks the heavy weighting toward large caps that XLE does.Crashing oil prices have done a number on all energy-related ETFs. Some companies have already declared bankruptcy, and it could be just the beginning. While it's true that XOP has enjoyed a nice rebound off its lows, even rising north of the 50-day moving average, it remains one of the more vulnerable areas of the market. This week's drop saw XOP break short-term support and its 20-day moving average. It's the first support breach since the uptrend began and could spell the start of the next downswing.Once again, we're harnessing bear put spreads to profit.The Trade: Buy the Sep $35/$30 put spread for $1.00You're risking $1 to make $4 if XOP is below $30 at expiration.For a free trial to the best trading community on the planet and Tyler's current home, click here! As of this writing, Tyler held bullish IWM positions. More From InvestorPlace * Top Stock Picker Reveals His Next 1,000% Winner * America's Richest ZIP Code Holds Shocking Secret * 1 Under-the-Radar 5G Stock to Buy Now * The 1 Stock All Retirees Must Own The post 3 High-Reward Bear Trades for the Next Market Crash appeared first on InvestorPlace.
While data points to an overheated market, sector positioning says big sellers have disappeared, and earnings reactions have been okay.
One of the easier-to-spot market themes right now is the widening performance gap between large and small companies. While many behemoths are rapidly reclaiming lost ground, there are a growing number of little guys that remain, well, lost. Today we're looking at four such stragglers that are top stocks to sell.To see this trend, you can compare two of the Street's favorite Indexes: The Russell 2000 and Nasdaq-100. The former will be your proxy for small-caps, and the latter will represent large-caps. While you could use the S&P 500, the biggest gainers are coming from the technology sector, which makes the Nasdaq-100 a more appropriate ticker. Its strength provides a more stark contrast to the Russell's depressing drift.The story for why small-caps find themselves losing ground in the recovery game is simple. They are the most vulnerable to an economic downturn due to their higher debt loads, dwindling cash balances, and lower credit ratings. These are all fundamental factors that cause investors to look more warily on small companies during challenging climates. And given the Covid-19 horror show that is wreaking havoc on Main Street, now seems like a perfect time for investors to shun higher-risk companies.InvestorPlace - Stock Market News, Stock Advice & Trading TipsMy list of stocks to sell contains numerous tickers, but here are four of the top picks: * iShares Russell 2000 Index ETF (NYSEARCA:IWM) * SeaWorld Entertainment (NYSE:SEAS) * KB Home (NYSE:KBH) * Yelp (NYSE:YELP) * 9 Asian Stocks to Buy for a Post-Coronavirus Recovery Let's explore the narrative behind their poor performance and why their price charts are flashing warning signs. Small-Cap Stocks to Sell: iShares Russell 2000 Index ETF (IWM)Source: The thinkorswim® platform from TD Ameritrade The easiest path to betting against small-caps is to short the iShares Russell 2000 Index ETF. It allows you to sidestep picking specific stocks and instead set yourself up to profit from the continued demise of the entire space. IWM's rebound has returned the fund to the scene of its significant support break.If the principle of polarity holds, this old floor will become a new ceiling. And that makes entering bearish trades against the $126 resistance area an attractive proposition. Instead of shorting stock or buying expensive puts, I like using bear put spreads. By keeping the cost low enough, we don't need to use a stop loss if the trade sours.The Trade: Buy the June $110/$105 put spread for around $1.25. SeaWorld Entertainment (SEAS)Source: The thinkorswim® platform from TD Ameritrade The social distancing trend has destroyed SeaWorld's stock price. And it has largely sat out the market recovery. Sure, the initial oversold snapback was glorious. SEAS ramped 171% over five trading sessions. But the gains quickly fizzled, and with Thursday's 11% decline, the stock is one wave away from revisiting its lows.At a minimum, we'd need to see a push back above $13 resistance to reverse the short-term trend higher. It would mark a change in character and merit reassessing my pessimism. Until then, it's game on for bears. Watch for a break below the $8.50 support pivot before pulling the trigger. * 9 Robust Stocks to Buy to Survive a Bear Market The Trade: Buy June $9/$6 bear puts for around $1. KB Home (KBH)Source: The thinkorswim® platform from TD Ameritrade On the narrative front, I see a tug-of-war playing out with homebuilders. The bullish pull of low interest rates is up against the bearish forces of massive unemployment and banks raising borrowing standards. Cheap money means little when people are out of jobs, and banks are demanding customers bring big down payments and sterling credit.KB Home shares were demolished during the crash, falling 75% in less than a single month. Consider this an example for the ages of just how quickly the market can price in Armageddon. KBH has doubled off the lows but still looks vulnerable. It's below the 50-day and 200-day moving average, suggesting more work is needed before the trends turn.Watch for a break of this week's low ($19.15) as your trigger for the following play.The Trade: Buy the July $18/$14 bear put spread for around $1.50. Yelp (YELP)In scanning for stocks to sell, I focused on those that were quick to give back their gains after last month's snapback. Failing to make a higher pivot high on their second bounce attempt also signaled that sellers were still afoot. YELP stock has both characteristics and strikes me as still vulnerable.It's one of the worst looking tickers on my watchlist, and that makes it a natural choice for short trade ideas. This week saw the company's shares slip back below the 20-day moving average. A push above $23 resistance would make me reassess. Until then, I'm in the bear camp.The Trade: Buy the May $20/$15 bear put spread for around $2.For a free trial to the best trading community on the planet and Tyler's current home, click here! As of this writing, he held long-term bullish positions in IWM. More From InvestorPlace * America's 1 Stock Picker Reveals Next 1,000% Winner * 25 Stocks You Should Sell Immediately * 1 Under-the-Radar 5G Stock to Buy Now * The 1 Stock All Retirees Must Own The post 4 Struggling Small-Cap Stocks to Sell appeared first on InvestorPlace.
Executive Summary: Three weeks ago I predicted that the U.S. death toll from COVID-19 would reach 20,000 by April 15th. In this article I will tell you what you should expect next. Article: I saw this coronavirus pandemic coming back in February. I first warned our premium subscribers and then published a free article on […]
Modern Portfolio Theory (MPT) alleges that well-diversified securities and targeted cash levels will insulate investors during market downturns. Folks stopped talking about MPT after the 2008 crash, but the discussion kicked up again, right on schedule, when financial markets roared back to life at the start of the last decade. In fact, Wall Street did everything in its power between 2010 and 2015 to induce amnesia about the underlying risk of this widely adopted approach.