The 2020 stock market will be studied for years not just by market watchers and economists but sociologists, psychologist, and futurists. The stock market reflects our knowledgeable subconscious, which can often go completely opposite of how we feel about today, as it focuses on the future.
That was the case in the spring as Covid-19 was spreading and headlines screamed the worst was yet to come for the economy and stock market.
While the rebound off the lows has been admirable, the notion “the market” is up is a huge misnomer. Market breadth is among the worst ever for a positive year, as 40% of the names in the S&P 500 will finish the year in the red.
This presents a dilemma for investors that wonder if they should hold the winners and ride the wave, rotate into the also-rans on the hunch they are due to rebound, or maybe move to the sidelines on a similar guess.
The answer: Own stocks of great companies growing top line organically, enjoying pricing power, taking market share and history of management execution.
Market Not Too Crowded
The great news is there was so much fear, skepticism, and delay, that despite a flow spike into equities late in the year, it’s the only major asset class that saw net outflows in 2020.
So, while talking heads kept talking about TINA (no alternative), in reality, a lot of money was flowing out of equity mutual funds and ETFs.
A lot of fresh cash came in to buy up new issues, but that orderly cash sitting on the sidelines was focused on bonds. This is really good news, as there should be a shift into equities in 2021.
There is so much cash on the sidelines in household savings accounts and corporate coffers that will pour into the economy next year.
The vaccine will be more widely distributed, and the media will speak more optimistically about the country. Events and trends that would have been seen as glass half empty, or broken, will be seen as half full and brimming.
This morning, we sold a name in Consumer Discretionary and added to Materials. We are fully vested in the Hotline Model Portfolio. If you are not a current subscriber to premium Hotline Service, contact your account representative or email us at Info@wstreet.com and start off the New Year taking control of your future.
Initial jobless claims came in well below consensus at 787,000 and continuing clams drifted lower to 5,219,000; which was better than anticipated.
Initial Jobless Claims
Continuing Jobless Claims
This was an amazing year in so many ways. The difficulties are well-documented, and for too many, the lingering pain will continue for years to come – maybe for the rest of their lives.
I was somewhat shocked in March and April when our business erupted higher. Maybe, I should have seen it coming. In recent years, subscribers have asked what to buy when the market dipped rather than saying they wanted to close everything.
But this was a monster reversal, and I think it speaks volumes for the freedom individuals seek in all facets of their lives.
People are not taking the bait when media says the end is near – sell everything. People are not taking the bait when the experts say they shouldn’t own a home. And people are not taking the bait when Wall Street says you cannot beat the market, so just hand us your hard-earned cash, and we’ll get you four or five percent a year. You know, nice and steady, right?
It worked in 2000 when everyone sold and lost everything.
It worked less in 2009 but enough that tens of billions of dollars in stocks were sold into the bottoming process for unnecessary losses.
It did not work this time.
I will not always be right. You know my team and I will work hard and try our very best, every single day. I appreciate and honor your trust.
Happy New Year
|You’re one of the greats in our day, Mr Payne. Thank you for your optimism. Happy New Year!|
John on 12/31/2020 10:27:57 AM
|Same to you, Charles. Thanks for your sincerity and counsel. Class act....all the best!|
Bill Spahr on 12/31/2020 10:38:02 AM
|Charles, thank you so much for providing this service. Really, our family is on the right track for financial security thanks to you and your team.|
Looking forward to a fantastic New Year....Thanks to you!!
Lance Lyman on 12/31/2020 10:38:56 AM
|Enjoying your book and always your wisdom and subtle humor and long learned wisdom. Have great year Charles and Family! Trump 4 more years!|
Lorin K on 12/31/2020 11:15:07 AM
|Thank you Charles. I signed up for your services over a year ago and thought if I made my money back and a little more I would be happy. Well following you everyday has reaped so many rewards and profits. I'm now a day trader and fell in love with my money making money for me. Now my biggest fear is taxes, LOL. I have an LLC and a CPA and just recently renewed both hotline and swing services. I can't thank you enough. God bless you and your family.|
MARIA THOMAS on 12/31/2020 11:23:25 AM
|Ha! Thanks Maria, I hate those pesky taxes as well....I really do think they are too high and punitive. That said, it's not the worst predicament to owe a lot of taxes. Thanks for your kind words and keep rocking. CP
Happy New Year|
Charles Payne on 12/31/2020 11:51:49 AM
|God Bless to you, your Family and Team Charles. A Prosperous New Year to all. Joe|
Joe on 12/31/2020 11:55:30 AM
|Thank you so much Joe and the same to you and yours. CP
Happy New Year|
Charles Payne on 12/31/2020 12:04:27 PM
|I've watched you for years on Fox and Fox Business and have always wanted to take the plunge into the market. After reading your book, Unstoppable Prosperity, I finally got the courage to dive in. I subscribed to your service and gained more knowledge and confidence in the market. I have done very well thanks to you and your group. I was a little nervous when the bottom fell out of the market in late February and early March, but I never sold in panic thanks to your advice. What I appreciate most about you is your integrity and it's obvious how much you care about the average investor. I look forward to continuing with your service, continuing to make money and having control of my future. Have and happy and blessed 2021!|
Leslie Ankrum on 12/31/2020 12:11:09 PM
|Thank you Leslie. I got goosebumps reading your email. I have put in so much time over decades in an effort to be great for my subscribers. Like any business we mostly hear from folks when something goes wrong so it's heartening to get an email like this. I cannot guarantee results but I can guarantee I will maintain the same work rate and commitment and so will the team. CP
Happy New Year |
Charles Payne on 12/31/2020 12:15:46 PM
|Thank you Charles for your intelligent insight. I love your program. Keep up the great work. Happy and Healthy New Year.|
Bev on 12/31/2020 12:25:35 PM
|Thanks Charles to you and your Team! You are a blessing to our great nation. |
Happy New Year!
Steve Bolen on 12/31/2020 12:27:20 PM
|Charles..thanks for your insight, news letter and optimism....you are a bright light with a ton of knowledge...happy new year to you and your family|
Lawrence Gentile on 12/31/2020 12:29:19 PM
|Charles, thanks you for providing these services, I've been using them for approximately 3 months and have been able to double my investment. I hope that the economy picks up in 2021 and they do not increase or implement any new taxes.|
Happy New Year to you, your family and the team!
Paul Davis on 12/31/2020 12:30:57 PM
|I have kept up with Making Money for over a year now & have determined that I should listen to you even more. I have gotten & read your book & have learned a lot this year!! Up 28% with a lot of mistakes. Hope I can do it again. Thanks for sharing your knowledge. Really like that you look at reality & how things really are!|
David W Rogers on 12/31/2020 12:37:20 PM
|Just got on your website today. Been an investor since 1984 when I took early retirement. Don't have a lot of money, but have managed to live off our investments over the years. Was happy with the market this year and ended up living off the money and still up 11%. Have watched you and Maria for the last 5 years and am up at 5 AM five days a week. Would love to be a fly on the wall at a bar when you, Maria and Dagen have a few.|
Cheers and beers,
Jim Hannah on 12/31/2020 5:41:25 PM
|Charles: As with many who have sent you comments, I also purchased your book. Following your advice, training and examples, I changed my investments from 80-90% red to 80-90% green. Thanks. May your new year continue to be prosperous.|
Joe Keefer on 1/3/2021 12:09:04 PM
|Thank you so much Joe for taking the time and sharing such kind words. CP
Happy New Year|
Charles Payne on 1/3/2021 12:50:45 PM
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