A Summertime Stock Play
Amanda Heckman|May 27, 2023
It’s Memorial Day weekend.
A record number of folks are traveling… millions of grills are being fired up… and the nation is taking the time (we hope) to remember those we’ve lost in the fight for our freedom.
On Monday, Andy will share a special message in honor of the holiday. Be sure to look out for it.
But today, we’re getting ready for summer the only way an outfit like ours should…
By providing a ticker to hold all season long.
With the full faith and credit of our government and our dollar being called into question thanks to the fight over the debt ceiling…
Andy warned us on Monday to “invest accordingly.”
That means going big. Big companies, that is.
The reason is simple… They’re less sensitive to all the trouble we’re in.
That much is clear when you look at this heat map from Finviz…
Year to date, the big have just kept on getting bigger.
But there’s one big company in particular that should be on every investor’s summer “play” list…
If you’ll recall, Microsoft was Alpesh’s Stock of the Week last week. He likes it as a blue chip AI play with the potential for exponential earnings growth.
But here’s why it’s worth another look…
All Summer Long
You know the old stock market adage “Sell in May and go away”?
That’s the idea that bids traders to sell out of their positions as summer starts.
Trading volume is typically low throughout the season, and the markets tend not to move much.
On average, stocks post returns of about 2% during the summer, compared with nearly 7% in the winter months.
Microsoft, on the other hand, does far better in summer.
Our research team crunched the numbers… and the stock has averaged a 7% return over the last 10 summers… and that’s including 2022’s tech slump.
When you drill down to single-season moves… the stock sees double-digit gains more often than not.
So while the economy and the markets are sitting in a state of unease right now… Microsoft is the perfect “set it and forget it” summer play.
Soak up the gains, but don’t forget to use protective gear… in the form of a trailing stop.
Enjoy the holiday weekend, and have a happy Memorial Day.
Amanda Heckman is the editorial director of Manward Press. With unrivaled meticulousness, she has spent the past dozen or so years – give or take a few sabbaticals – sharpening Andy’s already razorlike wit. A classically trained musician and a skilled writer in her own right, Amanda takes an artistic approach to the complex world of investing. Her skill has led her to work with numerous bestselling authors, award-winning financial gurus and – lucky for us – the fine folks at Manward Press.