The midterm elections will be a game-changer any way you slice it. The expected bloodbath on Nov. 2 will impact every aspect of your investment strategy for 2011.
Are you ready?
Here a few actions you can take now to get your portfolio ready for Election Day and its aftermath.
Pre-Election Strategy #1 – Go for Unstoppable Growth Sectors
While just about every pundit is predicting that the Republicans will pick up seats in the House and Senate, we won’t know exactly how this is all going to play out until the dust settles on Nov. 3. But there are a few sectors you can count on for growth in 2011 — no matter which political party is in power. Infrastructure spending, for example, will continue pretty much unchanged regardless of the election result.
With the Republicans declaring their intention to repeal health care reform and the Democrats vowing to fight them tooth and nail, you might think that you should give health care stocks a wide berth. Not so. There are some areas of health care that are bound for profits no matter what happens long term. You’ll want to hold off on buying insurers and big pharma companies for now, but mail order pharmacies will continue to gain market share whether there is health care reform or not, as will the companies leading the charge on digitizing medical records.
And finally, whether you believe in climate change or not — and plenty of Republicans and Tea Partiers are skeptical — everyone agrees that we need more Clean Energy to reduce our dependence on oil. One stock I like in this area is a dynamic, under-the-radar mid-cap alternative energy stock — Westport Innovations Inc. (NASDAQ: WPRT). It’s a leader in the booming field of natural gas engine conversions.
The number of natural gas-powered vehicles doubled between 2003 and 2009, and it’s expected to grow FIVE times in the next 10 years. One of the biggest growth catalysts will be converting public transportation and commercial fleets to natural gas vehicles — a development already underway around the country. Westport is the clear leading global supplier of systems that let car and truck engines run on compressed and liquefied natural gas. The stock has already doubled over the past year, but my in-depth research tells me that the wave is just starting to build for these guys — and is pretty much unstoppable at this point.
Pre-Election Strategy #2 – Dump the Losers
Wall Street hates uncertainty more than anything. Once we’re past the election — no matter who wins — I expect a strong finish to the year. If you have stocks in your portfolio that haven’t participated in the recent rally, it’s time to clean house and get ready to put your money in companies that will do better for you.
I recently sent out an alert telling people to sell Amazon.com, Inc. (NASDAQ: AMZN) and Target Corporation NYSE: TGT), and I’ll say the same to you here. If you want to grow your money, you simply can’t afford to own yesterday’s leaders.
Pre-Election Strategy #3 – Be Prepared to Move Come Nov. 3
So you’ve indentified some stocks that will do well no matter what the outcome of the election. You’ve purged your portfolio of underperformers. Now what? Well, now you need to get ready to act quickly! Once the markets have a clear idea of the new political situation post-election, they will start to move. Which stocks and sectors are the winners and losers will depend on which party wins or loses, of course. But either way, there will be a change, and you don’t want to get caught unprepared.
Get Hilary Kramer’s Post-Election Game Plan — FREE!
Don’t let the upheaval in Washington wreak havoc on your investments. My Post-Election Game Plan will help you protect yourself and profit from the midterm mayhem. Over the course of the next two weeks, I’ll give you ideas for stocks to buy before the election, send you 12 big-name stocks to sell and rush you a Special Alert on Nov. 3 detailing the market winners and losers in the election aftermath. Sign up here, plus get my “3 GameChanger Stocks to Buy Before Election Day” — yours FREE!