Don’t quarantine your wealth. Do this instead…

On April 1, InvestorPlace analyst Matt McCall is revealing details about a little-known corner of the markets that could hand you a fortune during a bear market. To prove it, he’ll share the name of his #1 bear market stock.

Wed, April 1 at 7:00PM ET
 
 
 
 

The Best-Performing Sectors for Q4

These were the best fourth-quarter performers 1995-2009

Uncertain markets, poor returns and general fear all helped push investors into bonds in the most recent quarter, leaving many people underexposed to stocks.  That may be a mistake.

According to the Investment Company Institute, a trade group, net inflows to bond funds in the first eight months of 2010 totaled $216 billion, compared to net outflows $18 billion for equity funds.  Investors have abandoned stocks for some understandable reasons.  Most notably, as of Sept. 30, the S&P 500 would still have to rally 37% just to climb back to its all-time high of 1565.15 reached on Oct. 9, 2007.

But according to Robert F. Carey, chief investment officer of First Trust, Wheaton, Ill., November and December have proven to be the two best performing months for stocks since 1950.  As a result, now may be an opportune time to re-enter the equity market.  But that begs the question: Which sector would present the most opportunity?

Based on data from Bloomberg and Barclays Capital, here is a table of the top-performing sectors, including their best and worst years, from 1995 to 2009. 

Granted that making comparisons between previous time periods and today is difficult due to the significant recession, high unemployment, weakening dollar and household deleveraging, but  history cannot be readily discounted.

With that in mind, here is the data. 

Q4’s Top Performing Sectors from 1995-2009  
       
Sector Average Best % -Year Worst % -Year
S&P 500 Telecommunication Services 7.96% 37.69% ‘02 -19.12% ‘00
S&P 500 Information Technology 7.34% 36.46% ‘98 -33.39% ‘00
S&P 500 Consumer Staples 6.33% 22.25% ‘98 -12.83% ‘08
S&P 500 Consumer Discretionary 5.97% 29.39% ’98  -22.85% ‘08
S&P 500 Materials 5.78% 23.14% ’03  -30.78% ‘08
S&P 500 Industrials 5.15% 18.18% ’98  -23.92% ‘08
S&P 500 5.04% 21.30% ’98  -21.94% ‘08
S&P 500 Health Care 5.02% 14.69% ’98  -12.10% ‘08
S&P 500 Utilities 4.16% 16.76% ’97  -10.92% ‘08
S&P 500 Financials 3.61% 22.23% ’98  -36.92% ‘08
S&P 500 Energy 3.02% 15.30% ’03  -20.61% ‘08
U.S. Aggregate Bond 1.81% 4.58% ’08  -0.12% ‘99
Municipal Bond (22+) 1.24% 4.37% ’00  -0.96% ‘09
Source: Bloomberg and Barclays Capital    

Article printed from InvestorPlace Media, https://investorplace.com/2010/12/the-best-performing-sectors-for-q4/.

©2020 InvestorPlace Media, LLC