Investors can use RCD in unison with individual discretionary stocks to round out their portfolios’ allocation to the sector. For example, pairing RCD with strong discretionary names such as Time Warner (NYSE: TWX) or Dow component Walt Disney (NYSE: DIS) could prove rewarding going forward.
“If I use the RCD to get 2/3 of my total exposure to cyclical stocks, I can supplement my sector weighting with some individual names that I feel will outperform if the U.S. economy delivers the 2-2.5% annual growth that after today seems quite likely to occur,” adds Capital Cube.
RCD’s largest industry allocation is 21.9% to specialty retailers followed by 18.4% to media names. A combined 23% goes to hotel and restaurant and household durable names.
Guggenheim S&P Equal Weight Consumer Discretionary ETF