Frequent listeners have probably sensed that Matt McCall has been focusing on large-capitalization names in the last few weeks. He’s asked investors to share their thoughts on Boeing (NYSE:BA) and Disney (NYSE:DIS), companies that are seriously hurting. But in this week’s episode of “Moneyline” he’s back with an important reminder. The rebound in small-cap stocks is sure to be bigger and better.
He often focuses on large-cap stocks because his subscribers are paying for his specific small-cap recommendations. But he doesn’t want investors to miss out on what could be a huge opportunity.
From when the market hit a high on Feb. 19 until March 18, the the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) lost 29% of its value. In contrast, the iShares Russell 2000 ETF (NYSEARCA:IWM), which tracks a basket of 2,000 small-cap stocks, was down 41%. It’s clear from this comparison that small-cap stocks do in fact fall further in a downturn.
But you can’t stop at March 18. As the markets started to climb higher, McCall noted that as of April 3, the SPY ETF was up 4.9%. On the other hand, the IWM ETF was up 7.7%. Small-cap stocks were outperforming the broader market.
Now is the perfect time to be looking for good entry opportunities in small-cap stocks. However, McCall warns that an exchange-traded fund like IWM is not the best play. Instead, he encourages investors to pick their own individual small-cap stocks.
So besides small-cap stocks, what else is on McCall’s mind? Well, as the halvening day for bitcoin approaches, he’s certainly watching the cryptocurrency space. He remains bullish on a handful of alt-coins, too.
And once again, he’s reminding investors not to worry about day-to-day price action. Historically, after these halvening events, cryptocurrencies have seen absolutely massive gains. He’s ready for a similar rally later this year. Plus, the alt-coins he likes represent some impressive next-generation software.
Okay, so small-cap stocks and cryptocurrencies are on his short list. But McCall knows his listeners like to research specific tickers. That’s why he’s sharing a company that’s on his watch list — just remember this isn’t a recommendation.
As the novel coronavirus eases in China and people return to work, he’s really liking a handful of Chinese stocks. He also notes that in particular, companies listed in Hong Kong did remarkably well during the downturn. With this in mind, he’s watching Sea Limited (NYSE:SE), to see how it fairs. Never heard of it? Well, it’s a Chinese gaming company that specializes in mobile and PC games, eSports and access to livestreamed gaming.
McCall knows that gaming is big right now, and as people opt (or are forced) to stay home, he anticipates the industry will just get bigger. That makes SE stock a great one to start watching.
For more on the current bear market, some analyst recommendations and beer stocks, tune in to this episode of “Moneyline” with Matt McCall.
Matthew McCall left Wall Street to actually help investors — by getting them 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) and +1,044% in Tesla (TSLA), just to name a few. Click here to see what Matt has up his sleeve now. Matt does not directly own the aforementioned securities.