The subdued expansion looks like a “V-shaped” recovery, and if this holds true, the more economically-sensitive sectors, which are priced for the “V,” may prove to dismay investors.
Market “historicals” are interesting to take note of and can help you locate areas that could present opportunities at some point, but investors can put a trend following strategy to use to identify the actual opportunities that take place. As this recovery has shown, it may not always be what the markets historically expect. [10 tips for managing risk.]
For more information on trend following, visit our trend following category. More on trend following can be found in The ETF Trend Following Playbook.
Max Chen contributed to this article.