Economic recovery is continuing in the midst of historic inflation, with the average U.S. household’s spending increasing 1.3% and helping to spur further growth, reports the Wall Street Journal.
In addition to personal spending rising, personal income also grew by 0.5% and jobless claims fell to new historic lows, creating an environment that favors continued economic recovery and growth. As the labor market continues to strengthen, it means a continued influx of money into spending that could help to balance the Fed’s tapering of bond stimulus.
Spending on goods was up 2.2% in October, and that included increases in both small purchases and big-ticket ones, and business investment seems to be on the uptick as well, with nondefense capital goods up 0.6%, which is a fairly good barometer for engagement from the business side. This year has seen continued growth from business investment as companies continue to spend on technologies to fuel their own growth.
Industries like travel that have been stricken by the pandemic are showing growth once more, and consumer demand for goods is up across the board heading into the holiday season. Several of the major big box retailers have indicated that they have sufficient inventory levels to account for holiday traffic and are confident in their performance heading into the fourth quarter.
“The consumer is still a big driver,” said Derrick Fung, chief executive at market research firm Cardify.ai. “We’re forecasting a very strong holiday season.”
Capturing Economic Recovery and Growth With FDG
The American Century Focused Dynamic Growth ETF (FDG) is an active, semi-transparent fund that seeks long-term capital growth by investing primarily, but not only, in large-cap growth companies.
FDG seeks to invest in early and rapid stage growth companies that are expected to appreciate in value, evaluating the individual companies instead of market forecasts when making investment choices. The strategy of the fund is based on the belief that, in the long term, the price movements of stocks trend along growth in revenue, earnings, and/or cash flow.
As such, the portfolio managers seek companies that are exhibiting accelerated growth in their earnings or revenue, compared to market expectations, peers, recent market trends, and the fund’s benchmark, the Russell 1000 Growth Index.
As a semi-transparent fund, holdings are disclosed on a quarterly basis instead of daily.
Top holdings include Tesla (TSLA) at an 8.56% weighting in the fund as of the end of October, along with Bill.com Holdings Inc (BILL) at a 7.02% weight, and Amazon.com (AMZN) at a 6.4% weight.
FDG has an expense ratio of 0.45%.
For more news, information, and strategy, visit the Core Strategies Channel.
