We Have a New Stimulus Package Coming. Now What?
By now, you’ve likely heard and read about the new stimulus package that includes $600 payments to Americans who made less than $75,000 in 2019, and another $600 for each kid under 18. I won’t bother going into the details, or whether or not it’s enough. You’ll get plenty of that elsewhere.
For investors like us, the bigger question is… now what?
What do we do with this information? To me, it means more of the same I’ve been telling you for months now.
First thing’s first: Keep your focus on not just possible rewards, but also potential risks.
It will take some time for the new stimulus package to move into the economy. But it will serve as additional support for the stock market.
We must keep in mind that we could be in the midst of a bubbly melt-up phase. And in a bubble, crazy things can happen — and that includes quickly making or losing a lot of money.
What Your Personal Stimulus Package Should Include
So given a new relief check is coming, it’s a good idea to write down plans for a new stimulus plan for your portfolio. What stocks, along with distribution of the COVID-19 vaccine and a full reopening of America, have the best risk-reward profiles?
COVID-19 will cease to be the threat that it is now in the months ahead. And as that happens, I expect investors around the world will shift into emerging-market stocks in a big way. You’ll be able to buy fast growth at far cheaper prices than the typical U.S.-based Nasdaq growth stock.
If you own your basic, high-flying tech stocks, chances are much of the impact of the new stimulus package is already priced in. In my view, that’s not the case if you focus on energy, financials and emerging markets.
Those are three sectors I’m looking at in regard to the new stimulus package. Check out my short video and let’s talk tickers , and which companies I’m banking on for big profits heading into the new year. Then share your thoughts in the comments below.
And as always, send your investing questions to jeff@yastine.com. You can also follow me on Twitter and Facebook.
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