The Next Sector to Boom
Sector rotation is not some complicated theory.
It’s something that happens every few weeks, months or even years on Wall Street. Lately, it’s been weeks or months.
A sector rotation is when investors, usually institutions and hedge funds, move money from one sector to another based on which one they think will do better in the weeks or months ahead.
These big-money investors move into sectors early and create a buzz in the media and in research reports.
That buzz is like honey to regular investors, who pile in as prices go higher.
Then the hammer falls, and the big money rotates into another sector.
It could be weeks or months before that happens, so there is time for retail investors to profit.
Right now, the sector that is being rotated into is energy.
No surprise there, as oil and gas prices are at multiyear highs.
Could they go higher? Sure.
But the easy money has already been made.
Of course, we’ve been ahead of the game in The War Room.
In mid-March 2020, I pointed out to members that insiders were buying Exxon (NYSE: XOM) for around $46.
Karim R. 3/13/2020 at 2:38 p.m.
Exxon – the first insider buys I have seen in a while: XOM Exxon Mobil Corp Weldon William C (Director) B 4,180 $48.09 201,016 14:27:52 – 2020-03-06 Weldon William C (Director) B 4,590 $43.56 199,940 14:27:52 – 2020-03-09
I continued to point out the rotation into the energy sector, before anyone else had caught on to it…
Karim R. 4/1/2020 at 3:54 p.m.
Companies like Schlumberger and Halliburton will be the survivors who will emerge with very few competitors, just like the surviving banks from the 2008-2009 crisis. What’s bad for the industry is not always bad for those that have the staying power.
And I may be onto something early again.
I think the sector that will rally in the coming weeks, months and years is the biotech industry. It has been hammered to the tune of a loss of more than 40% since the beginning of the year and is now ripe for a big-money rotation.
Action Plan: When the biotech sector bounces, War Room members will be ready to cash in. In fact, we are trying hard right now to get into a specific trade that would give us a ton of upside options – and put us into the play at a fraction of what others are paying.