Wednesday Wealth Recap
- When someone tells you that the stock market has it all wrong, they’re not just saying they’re smarter than some people… They’re saying they’re smarter than everybody. Alexander Green has a problem with that.
- Traders and surfers have more in common than you think. As Nicholas Vardy explains, experienced traders understand that not all “waves” are worth surfing… but when a big one comes in, the profits make the wait well worth it.
- Every time we try to buy happiness, we end up filling our lives (and our garages) with useless junk. Manward Press founder Andy Snyder has some ideas for how to break that cycle.
Karim Rahemtulla recently highlighted the three investing themes that’ll work well during an extended Trump presidency: guns, gold and energy.
His three picks are the following:
- Smith & Wesson Brands (Nasdaq: SWBI)
- Kirkland Lake Gold (NYSE: KL)
- Energy Select Sector SPDR Fund (NYSE: XLE).
Those are three strong picks.
But today, I’d like to chime in – and give you the very best pick to immediately buy if Trump pulls off another crazy upset.
You see, in my opinion, the VERY BEST name to buy in this situation is the SPDR S&P Aerospace & Defense ETF (NYSE: XAR).
Here’s why…
It mirrors the returns of the S&P aerospace and defense sector. Year to date, it’s down 23%. So it’s one of the true “bargains” available to you right now.
But unlike most defense plays, which hold the bigger names – such as Raytheon (NYSE: RTX), Lockheed Martin (NYSE: LMT), General Dynamics (NYSE: GD) or Northrop Grumman (NYSE: NOC) – the SPDR S&P Aerospace & Defense ETF is appealing to me because it offers you exposure to one of the most promising sectors around: space.
Take a look at its top 10 holdings:
- Cubic (NYSE: CUB)
- Mercury Systems (Nasdaq: MRCY)
- Virgin Galactic (NYSE: SPCE)
- Maxar Technologies (NYSE: MAXR)
- Axon Enterprise (Nasdaq: AAXN)
- Boeing (NYSE: BA)
- BWX Technologies (NYSE: BWXT)
- Aerojet Rocketdyne (NYSE: AJRD)
- Teledyne (NYSE: TDY)
- Curtiss-Wright (NYSE: CW).
Allow me to note some highlights…
- Virgin Galactic is the space tourism name that’ll soon be flying commercial passengers on Mach 3 – at three times the speed of sound.
- Maxar Technologies offers you the world’s top satellite technology.
- Aerojet Rocketdyne offers you the world’s top rocket engine technology.
Oh, and you also get Axon Enterprise, which sells nonlethal Tasers and body cameras – and I believe these will soon be found on every law enforcement officer in America.
From a chart perspective, consider its past two sell-offs…
In late 2018, this collection of companies dropped over a two-month period – only to fully recover and achieve new highs over the following 10 months.
And most recently, from the COVID-19-based sell-off in March and April, the SPDR S&P Aerospace & Defense ETF has already begun its recovery, which is ongoing right now. If the last sell-off and bounce pattern mirrors that of 2018, then it’s reasonable to think it could soon retest and move above the previous high around the $120 level.
Action Plan: If Trump pulls off another crazy upset – or even pulls close in the polls – the SPDR S&P Aerospace & Defense ETF will be the top name on my buy list.
Yours in smart speculation,
Bryan
