Forget about Dogs of the Dow. I want to own the Dogs of January.
With each passing day, I am becoming more and more confident in my forecast of a 10% gain in the major market indexes in 2014.
The selling in January might be nerve-wracking, but it took what little froth there was in the market out of the equation.
In other words, we are experiencing a normal and very healthy pull-back. Don’t let the fear-mongers prevent you from missing out on what ultimately will be another year of solid gains for equity investors.
Jeremy Siegel sums it up perfectly by stating that those most screaming about a bubble in any asset class are the ones that never owned that class to begin with. How right he is!
How many investors missed out on the run in 2013?
I know some very serious hedge fund managers were clocked by being too pessimistic last year. In fact returns in the entire hedge fund complex last year were pathetically lacking.
To make up for that missed opportunity, they have been using the turn of the calendar to promote their bearish case. The problem is there is no real reason to be bearish.
Stocks at worst are fairly valued and the economy in the U.S. is poised to grow solidly in 2014. More importantly, there is none of the excess that typically results in a bear market sort of freefall.
As such, it would make sense to be a buyer in the wake of selling here in late January. A good place to find what stocks to buy would be those dogs of January – the dogs that can still bark.
These stocks are being thrown out for no particular reason and yet growth prospects remain. That to me is the formula for investing success.
Here then are three dogs of January to consider buying today: