This Chart on Interest Rates Will Have You Finding Stocks to Buy Now

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Every day I scan through hundreds (if not thousands) of charts — and there’s one about interest rates I feel is imperative to share with you today.

In fact, this data caught my eye so strongly that I sent it to my CEO, Brian Hunt, in the middle of the night!

The next day we had lunch and Brian told me that he moved over $350,000 into the stock market after looking at the chart I sent. Naturally I laughed and assumed he was joking. But, he wasn’t.

This is a man who has lived and breathed the stock market for the last 20 years. This is not some amateur investor who is new to the game. I found it fascinating that this one chart was enough to motivate Brian to push a large sum of money into the market. But then again, I should not be surprised because I also have been busy buying stocks since that chart popped up on my screen!

My research is broader than many analysts. If you’re familiar with my methods, you know I love to travel and put my boots on the ground for face-to-face conversations with company leaders, industry experts, consumers, suppliers or anything else that gives me an edge. I also subscribe to multiple data services so I can sift through the numbers in search of the next great stocks to buy — and this particular one comes to us from LPL Financial:

The #1 Reason I Am Looking for Stocks to Buy Now

It shows every time since 1980 that the Federal Reserve (Fed) cut interest rates when the S&P 500 was within 2% of an all-time high.

That’s the situation we’re likely to be in soon. And historically, this has occurred 17 times in 39 years. In all 17 instances, the S&P 500 was higher one year later. Even more impressive was the average gain of 15% in the year after the Fed cut rates.

If you are not yet sold after seeing that chart, here is another…

Fundstrat looked at instances when the Fed cut interest rates during an expansionary period for the U.S. economy, going back to 1971. Every single time, the market was higher three, six, nine, and 12 months later. And the returns were impressive:

The #1 Reason I'm Looking for Stocks to Buy Now

One year later, the average gain was 16.5%. A 16.5% return from today would push the S&P 500 above 3,500!

For context, the average 12-month return for the S&P over the last 50 years is about 8%. So, in this particular situation of a Fed rate cut near market highs, we see nearly twice the average returns.

I’ll be covering this phenomenon in my investment services… but this is so important that I decided to go ahead and share it now. If there is ever a time to be in the market, finding stocks to buy — it is now!

Another thing to keep in mind is that the S&P 500 is already sitting near an all-time high — and the rate cut is highly likely to happen soon. According to the Federal Reserve Bank of Atlanta, the probability of a 25 basis point cut to interest rates by mid-September is 95.6%. Both Citigroup and JPMorgan are predicting a 25 basis point rate cut here in July — and Morgan Stanley and UBS are going even further. They expect a rate cut of 50 basis points in July.

Now, while a one-year gain of 16.5% is impressive for the S&P 500… I believe that if this historical trend holds, then certain investment themes will greatly outperform:

The emergence of 5G. The introduction of self-driving vehicles, powered by next-generation batteries. The continuation of one of the biggest investment opportunities of a generation — cannabis. Don’t forget about the Internet of Things (IoT), artificial intelligence, and gene therapy, as well.

These high-growth megatrends are set to continue their dominance — and the winners will see gains several times more than the overall market.

Why I Like Penny Pot Stocks Now

We might be near all-time highs now. But here’s the good news: Many attractive stocks are both undervalued and still in “penny stock” territory.

Penny stocks often get a bad rap. But they are actually critical to the global marketplace. The world NEEDS tiny companies — just as much as bigger ones. They’re the job creators. The innovators.

And as an investor, if you’re looking for the next Netflix (NASDAQ:NFLX) or Apple (NASDAQ:AAPL), this is where you’ll find it.

You just want to be VERY choosy about which ones you buy.

That’s what I designed my Cannabis Cash Calendar system to do specifically for marijuana IPOs.

Legalization is still working its way across the country (and the world), which means that for most successful companies, their biggest gains are yet to come. Oftentimes, you can buy tomorrow’s leaders for just pennies a share, or maybe a few dollars.

I’l be releasing my next Cannabis Cash Calendar recommendation soon. You can get exclusive access to it the moment it is released to my Investment Opportunities readers. Click here to learn more and get on the list to be notified.

P.S. Maybe you don’t know much about marijuana stocks. That’s fine. Even if you’ve never bought a stock before, you’ll want to check this out. I’d say take a small stake… and you could potentially see that multiply over the next 12 months. Click here for more on this incredible opportunity.

Matthew McCall is the founder and president of Penn Financial Group, an investment advisory firm, as well as the editor of Investment Opportunities and Early Stage Investor. He has dedicated his career to getting investors into the world’s biggest, most revolutionary trends BEFORE anyone else. The power of being “first” gave Matt’s readers the chance to bank +2,438% in Stamps.com (STMP), +1,523% in Ulta Beauty (ULTA), +1,044% in Tesla (TSLA), +611% in Liquefied Natural Gas Limited (LNGLY), +324% in Bitcoin Services (BTSC), just to name a few. If you’re interested in making triple-digit gains from the world’s biggest investment trends BEFORE anyone else, click here to learn more about Matt McCall and his investments strategy today.


Article printed from InvestorPlace Media, https://investorplace.com/moneywire/2019/07/this-chart-on-interest-rates-will-have-you-finding-stocks-to-buy-now/.

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