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SECTOR INVESTING FOR MAXIMUM PROFITS


We focus on Sector Investing Strategies using proprietary Money Flow, Momentum and Relative Volume indicators to select Stocks and ETFs. We can go long or short depending on market conditions. A small select group of 2x Index ETFs are also key parts of our portfolio mix.


Follow the Top 3 Sector Portfolio, with a return of +144% from the March low (3/23/20)

up 173% past 1.5 years and +179% past 3.5 years. All charts and data updated daily to keep you in touch.


Mission:

Highest Total Return thru Sector ETFs in industries that disrupt, innovate and improve the way the world works. Like ARKK - Ark Innovations ETF. Our #1 holding up 425% past 3.5 yrs as of 11/24/20. That's a 121% average yearly return.




MARKET DASHBOARD

Wednesday 11/25/20 Market Close






New highs for the Nasdaq ahead of Thanksgiving


25-Nov-20 16:10 ET


Dow -173.77 at 29872.41, Nasdaq +57.62 at 12094.32,

S&P -5.76 at 3629.67


[BRIEFING.COM] The Nasdaq Composite (+0.5%) set intraday and closing highs on Wednesday, while the S&P 500 (-0.2%), Dow Jones Industrial Average (-0.6%), and Russell 2000 (-0.5%) edged lower from record territory.

Even with the Nasdaq's performance, today was a digestion kind-of-day for the broader market following a stretch of heroic gains this month. Granted, the S&P 500 energy (-2.4%) and materials (-1.1%) sectors did succumb to minor profit-taking interest, but overall, losses were kept in check.

Investors took defensive positions in mega-cap stocks like Apple (AAPL 116.03, +0.86, +0.8%) and Amazon (AMZN 3185.07, +67.01, +2.2%), which lifted the information technology (+0.2%) and consumer discretionary (+0.6%) sectors, and more conservative stocks like those in the real estate (+0.2%) and utilities (+0.1%) sectors.

Among the data that was dumped to investors before Thanksgiving Day, two reports stood out: weekly initial claims were higher than expected at 778,000 (Briefing.com consensus 735,000), and the pace of October new home sales was better than expected at 999,000 units (Briefing.com consensus 977,000).

Separately, the FOMC Minutes for the November meeting indicated that participants were debating ways to enhance guidance for asset purchases. The current pace of purchases remained appropriate.

In corporate news, The Wall Street Journal reported that Salesforce (CRM 246.82, -14.02, -5.4%) has been in talks to acquire Slack (WORK 40.70, +11.12, +37.6%), which sent CRM shares down 5% and WORK shares up 38%. Gap (GPS 21.60, -5.27, -19.6%) shares plunged 20% following its earnings report.

U.S. Treasuries finished little changed in a lackluster session. The 2-yr yield was flat at 0.16%, and the 10-yr yield was flat at 0.88%. The U.S. Dollar Index decreased 0.3% to 91.96. WTI crude futures rose 1.9%, or $0.83, to $45.72/bbl. Reviewing Wednesday's data dump:

  • Initial claims for the week ending Nov. 21 increased by 30,000 to 778,000 (Briefing.com consensus 735,000). Continuing claims for the week ending Nov. 14 decreased by 299,000 to 6.071 million.

  • The key takeaway from the report is the increase in initial jobless claims, as it is a reflection of the renewed challenges for the labor market that have been triggered by the surge in coronavirus cases and efforts/restrictions to contain the spread.

New home sales decreased 0.3% m/m to 999,000 in October (Briefing.com consensus 977,000) from an upwardly revised 1.002 million (from 959,000) in September.

  • The key takeaway from the report is that demand for new homes is strong and inventory is limited, which is pushing up prices that could turn into a headwind for future sales as affordability factors come into play.

Personal income declined 0.7% m/m in October (Briefing.com consensus 0.0%) following a downwardly revised 0.7% increase (from 0.9%) in September. Personal spending rose 0.5% (Briefing.com consensus 0.3%) following a downwardly revised 1.2% increase (from 1.4%) in September.

  • The key takeaway from the report is that income dropped as personal current transfer receipts declined 6.2%; moreover, this was an interest rate friendly report given the yr/yr deceleration in the price indices.

Total durable orders increased 1.3% in October (Briefing.com consensus 0.8%) following an upwardly revised 2.1% increase (from 1.9%) in September. Excluding transportation, durable orders were also up 1.3% m/m (Briefing.com consensus 0.4%) on top of a revised 1.5% increase (from 0.8%).

  • The key takeaway from the report is that it provides a positive input for Q4 GDP forecasts as shipments of nondefense capital goods, excluding aircraft, increased a healthy 2.3% following a 0.7% increase in September.


Third quarter GDP was unchanged at 33.1% with the second estimate (Briefing.com consensus 33.1%). The GDP Price Deflator was also unchanged at 3.6% (Briefing.com consensus 3.6%).

  • The key takeaway from the report is that it is seen as being too dated (we're nearly 2/3 of the way through Q4) to have any market-moving impact.


The final University of Michigan Index of Consumer Sentiment for November dipped to 76.9 (Briefing.com consensus 77.0) from the preliminary reading of 77.0. The Index stood at 96.8 a year ago.

  • The key takeaway from the report is that the lack of a significant shift in the headline number masked another downtick in future expectations.


  • Advance International Trade in Goods deficit widened to $80.3 billion in October (prior -$79.4 billion); Advance Retail Inventories increased 0.8% (prior revised to 1.7% from 1.6%); and Advance Wholesale Inventories increased 0.9% (prior revised to 0.7% from 0.4%)

Looking ahead, there will be no economic data released on Friday. The market will be closed for Thanksgiving Day on Thursday.


Love him or hate him, always interesting to see Jim Cramer's take on stocks to own into year end:



Cramer’s Best Stocks to Buy into year end:


Square - $191.66, up 206% year to date

PayPal - $190.90, up 76%

Tesla - $499.27, up 497%

Roku - $255.67, up 91%

Amazon - $3,117.02, up 69%

ServiceNow - $514.33, up 82%

Okta - $232.45, up 101%

RingCentral - $296.90, up 76%

Twilio - $295.64, up 201%

Target - $171.37, up 180%





Sector ETF Performance Monday Intraday


SECTORS UP


GDX +2% (finally a small bounce), Cloud +1.7%, Software +1.3%,

Internet +1.2%


SECTORS DOWN


Banks -2.4%, Energy -1.7%, Transports -1%, Defense -1%







Select Stock* Performance


STOCKS UP


SQ +4.5%, PYPL 3.4%, M 2.5%, SNAP 2.2%, AMZN 2.4%


STOCKS DOWN


Casinos lead the laggards: IGT -3.5%, WYNN -3%, with

Ford -4%, GM -3%, and Ulta -2.8%.





*This list of "Select Stocks" represents key companies in each sector we track. They are meant to be bellwether sector indicators. Rather than show a ton of stocks just to cover all the favorites, this keeps the list to a minimum, allowing easier observation of unusual volume in each sector.




STOCKS WITH HIGHEST VOLUME RATIOS TODAY *



#1 Nordstrom +17% (what?) on 350% above avg daily volume.

#2 Deere -1% on 319% above

#3 BBY +2.4% on 230% above

#4 Square +4.7% on 160% above.



*Note: The Zanger Volume Ratio measures the volume as a percent of the average daily volume for that stock. This is quite different from the traditional 'most active' volume measures, and is ultimately more predictive of where the stock is trending than standard cumulative volume indictors.


Zanger's trading system based on volume ratios has been highly successful in delivering above market returns, and has been used by the originator, Dan Zanger to achieve a world record in portfolio performance based on a year time frame: +29,000%. He famously sold his Porsche in the 1990's for $11,000 then turned it

into $18 million , Fortune Magazine has profiled him numerous times.





SECTOR PERFORMANCE FOR 2020 TO DATE



#1 - ARKK +113% #2 WCLD Cloud +83%, #3 Social Media +63%


SP500 +12.5%







MARKET INDEXES YEAR TO DATE

Nasdaq QQQ +39%

S&P 500 12%

Russell 2000 10%

Dow Jones 5%




HOT CHARTS:



Apple - in the caution zone...







XLE - Breaking out above the 200 day avg, we bought some for Top 3 Sector Portfolio on 11/23/20. Popped 39% from 11/2/20.






IGT - Gambling stocks make a comeback....






BOEING finally gets FAA approval on 737 Max,

it's had a remarkable stealth rally recently:







ARKK - Ark Innovation etf - #1 holding TSLA, outperforming, up 207% in past 7 months.






TSLA rising on inclusion into SP500, and the #1 holding in our favorite etf - ARKK, TSLA now up 607% since the March low. Wow.







Aerospace etf - XAR - Weekly chart shows the giant gaps up in the past few weeks, some big volume going in past few days. We own this in our Aggressive Growth ETF portfolio.






Market Update

Wednesday 11/25/20 10:00 am



Dow Jones Today Dips, Nasdaq Futures Rise As Jobless Claims Jump; Nikola Worries, China Investigation Hammers E-Auto Stocks



Stock futures buzzed in mixed trade Wednesday, as the Dow took a breather after its run above 30,000 on Tuesday and investors digested a broadside of mixed economic news. Nikola and China-based Nio and Xpeng sold off. Otherwise, early action was subdued, with Nordstrom and HP Inc. leading the premarket action on earnings reports. And Microsoft staked out a lead on the Dow Jones today.


Markets headed toward Thursday's Thanksgiving Day break with the Nasdaq back above 12,000 and Nasdaq 100 futures up 0.3% in early trade. S&P 500 futures struggled against a fractional decline. Meanwhile, Dow Jones futures dipped 0.2% below fair value on the stock market today.


On the S&P 500, earnings news set the early tone, with Nordstrom (JWN), HP Inc. (HPQ) and Deere (DE) topping the index after their earnings reports. Nordstrom shares have rallied 102% in November, through Tuesday's close. HP stock is extended after clearing a 20.07 buy point in a double-bottom base on Nov. 9. Deere broke out of a cup-with-handle base in July, and has since gained 53.5%.


At the bottom of the S&P 500, Gap (GPS) tumbled 10% after reporting results.

Early gains on the Nasdaq were modest. Zoom Video Communications (ZM) gained 1.6% as it aims to stem a two-day slip. Tesla (TSLA) and Qualcomm (QCOM) also traded at the top of the index, each with gains of less than 1%.


Stocks in or near buy zones early Wednesday included PayPal (PYPL), Google parent Alphabet (GOOGL), Advanced Micro Devices (AMD) and Zumiez (ZUMZ).



Jobless Claims Jump, Durable Goods Orders Top Views


Jobless claims jumped for a second week, with the Department of Labor reporting claims rising to 778,000 in the week ended Nov. 21. Economists had projected a downshift to 730,000 claims. Also, the prior week's tally was revised higher, to 748,000 applications.


Durable goods orders rose more than expected, up 1.3% in October, the Commerce Department reported. That was below September's powerful 2.1% rise, but well above the 0.9% increase projected by economists. Core capital goods rose 0.7%, down from the prior month's 1.9% gain, but above expectations for a 0.6% rise.


Commerce Department estimates for third-quarter GDP growth held fairly steady, with the quarter's rebounding 33.1% growth rate intact. Consumer spending was revised only slightly lower, to a 40.6% increase — below expectations for an upward revision to a 40.8% gain.

New homes sales, consumer data and personal income numbers are scheduled for release at 10 a.m. ET.



Dow Jones Today: Apple, Microsoft Lead


Microsoft (MSFT) traded near the head of the Dow Jones today, up about 0.4%. Both Microsoft and Apple (AAPL) have been pulled back tight to their 10-week moving averages, and trading well below Sept. 2 highs. Both stocks have been slogging through the process of building new bases. Apple remains 20% below its prospective buy point at 138.08. Microsoft is 9% off its possible entry at 232.96.


JPMorgan (JPM) and Boeing (BA) hung at the bottom of the Dow industrials, each trading around 1% lower. Goldman Sachs (GS) backed off 0.6%, suggesting it could potentially open back in a buy range above a 225.34 buy point.


China E-Auto Makers Dive On Investigation


Tesla stock slipped 1.9%, resisting some heavy early selling among its peers. Nikola (NKLA) dived 15.5% on investors' concerns over an expected $2 billion supply deal with General Motors (GM), and over the end of a lock-up period for shares held by founder Trevor Milton.


At the same time, China-based e-auto makers sold off after the country's National Development and Reform Commission opened a limited investigation into some companies' production details. Xpeng (XPEV) collapsed 11%, Li Auto (LI) dropped 12% and Nio (NIO) took an 8% fall.


Tesla and Nikola rallied on Tuesday, while China-based e-auto makers traded generally lower.



The Dow Jones View From 30,000


The Dow jumped more than 450 points to post its first close above 30,000 on Tuesday. The industrials had climbed to within 2% of the 30,000 mark in February, before taking their coronavirus bear market dive. Tuesday's move was a serious rally, and the 30,000 mark is a milestone. But maybe the more critical number for the Dow Jones today is 5.3% — the Dow's year-to-date gain.


The advance is far from the Dow's best years over the past decade. At the same time, any gain at all is startling given what the market, the economy and consumers have gone and continue to go through in this pandemic-rattled year.


Nevertheless, the S&P 500 is sitting on a 12.5% advance since Dec. 31. And the Nasdaq has managed a hefty 34.2% gain. Both the Dow and the S&P 500 are picking off new highs.


The Nasdaq is hunkered down in a consolidation, below a Nov. 9 high, and really meeting resistance right around the 12,000 level. That consolidation presents investors tracking the Invesco QQQ Trust ETF (QQQ) with a handle buy point at 297.56, and with a three-weeks tight buy point at 299.24.


The Dow had its breakout in an 830-point romp on Nov. 9. That led the SPDR Dow Jones Industrial Average ETF Trust (DIA) to break out past a double-bottom base buy point at 288.56. The ETF ended Tuesday near the top of the buy range, 4% above that entry.



UnitedHealth Weighs In


Premarket action showed the Dow Jones today poised for a mild early pullback. While the Dow rallied on Tuesday, its most heavily weighted stock, UnitedHealth Group (UNH), inched up 0.3%. At more than 7% of the Dow's total weighting, UnitedHealth is an important indicator for the portion of the market that pulled back and awaits Jan. 5 Senate run-off election results in Georgia.


A Republican win in those races would point to a GOP-led Senate, putting the brakes on any ambitious regulatory progress over the next two years. A Democrat win would leave the Senate tied 50-50, with Vice President Kamala Harris providing the deciding vote in issues divided strictly along party lines.


In the week ahead of the Nov. 3 election, UnitedHealth dived 7.7%, as investors braced for what many expected could be a Democratic rout. Following the election, when it looked as though the GOP had retained Senate control, UnitedHealth stock rallied more than 15% in two weeks. It has since pulled back to a base-level holding pattern, just above its 10-week moving average.


Amazon.com (AMZN), Apple and Facebook (FB) are among the other stocks to show similar behavior. All are similarly invested in a checked-and-balanced power scheme in Washington. And investors remain concerned that Democrat-controlled White House, House of Representatives and Senate would open a runway to more serious healthcare reform, digital privacy legislation and antitrust action against the big tech leaders.



STOCKS IN THE NEWS


Gap (GPS) – Gap reported quarterly earnings of 25 cents per share, missing consensus estimates by 7 cents a share. The apparel retailer’s revenue beat forecasts, however. Gap’s bottom line was hurt by increased marketing and shipping costs resulting from a shift to online shopping by consumers. Gap’s online sales surged 61% during the quarter compared to a year ago. Gap shares tumbled 10% in the premarket.


Nordstrom (JWN) – Nordstrom earned 34 cents per share for its latest quarter, compared to expectations of a 6 cents per share loss. Revenue came in below forecasts, however, partly because of a slide in demand for formal wear. Nordstrom’s online sales jumped 37%.


Shares of Deere (DE) – The heavy equipment maker reported quarterly earnings of $2.39 per share, well above the consensus estimate of $1.49 a share. Revenue beat estimates as well. Deere benefited from an improving farm economy, with crop prices rising and demand for replacement machines jumping. The company also forecast higher-than-expected earnings for the year ahead. Shares of Deere rose 1.8% in premarket trading.


HP Inc. (HPQ) – HP beat estimates by 10 cents a share, with quarterly earnings of 62 cents per share. The computer and printer maker’s revenue beat estimates as well. A surge in laptop sales driven by homebound students and workers helped offset lower sales of office equipment. Shares of HP rose 5.7% in premarket trading.


Dell (DELL) – Dell earned $2.03 per share for its latest quarter, well above the $1.40 a share consensus estimate. Revenue also came in above Wall Street forecasts. Its quarterly story was similar to that of rival HP, with a jump in demand for Dell’s desktop and laptop computers.


Viacom (VIAC) – Viacom is near a deal to sell its Simon & Schuster book publishing unit to German media giant Bertelsmann for more than $2 billion, according to people familiar with the matter who spoke to The Wall Street Journal.


Pfizer (PFE) – The government plans to send 6.4 million doses of Pfizer’s Covid-19 vaccine to communities across the U.S. within 24 hours of Food and Drug Administration approval, according to government officials who spoke to the Washington Post.


American Eagle Outfitters (AEO) – The apparel retailer beat estimates by a penny a share, with quarterly earnings of 35 cents per share. Revenue was very slightly above Wall Street forecasts. American Eagle also said it was pleased with early holiday season trends. The retailer’s shares slid 3.6% in premarket trading.


Autodesk (ADSK) – The design software company reported quarterly profit of $1.04 per share, beating estimates by 8 cents a share. Revenue also came in above analysts’ projections, helped by rising sales of its cloud-based offerings. Autodesk raised its full-year earnings forecast.


Canada Goose (GOOS) – The outerwear maker received a double downgrade at BTIG, to “sell” from “buy.” BTIG thinks that Canada Goose will have a difficult holiday season due in large part to a warmer start to the winter shopping period. The company’s shares slid 4.2% in premarket trading.


Darden Restaurants (DRI) – The parent of Olive Garden and other restaurant chains was downgraded to “neutral” from “buy” at BTIG, which points to the interruption of the recovery in casual dining sales as virus cases spike.



Sector Performance From The 3/23/20 Pandemic Low


Let's take a look at how all Index and Sector ETFs have done since the March Pandemic low on 3/23/20. This is how we measure current performance in

the Top 3 Sector Portfolio.


#1 ARKK 205% #2 QLD +184% #3 Builders 134%,

#4 Cloud +132%, #5 Social Media 124%,


SP500 +62% QQQ +73%







NEWS LINKS

WEDNESDAY STOCK MARKET ACTION


TRUMP ALLOWS BIDEN TRANSITION...FINALLY


ASTRAZENECA COVID VACCINE 70% TO 90% EFFECTIVE



AMAZON LAUNCHES HOME DELIVERY PHARMACY


FAA CLEARS BOEING 737 MAX TO FLY IN U.S.

AFTER 20 MONTHS


RETAIL SALES IN OCTOBER LESS THAN EXPECTED


MODERNA AND PFIZER'S COVID-19 VACCINES:

HOW DO THEY COMPARE?


92% OF ACTIVE MANAGERS FAILED TO BEAT SP500

PAST 15 YEARS





TOP 3 SECTOR PORTFOLIO STATUS

As of 11/24/20, the Top 3 Sector Portfolio is up 146% from the 3/23/20

March low. The SP500 is up 62% same time frame.


Our #1 holding is ARKK, up 206% since the March lows, #2 QLD +180%,

#3 is Social Media SOCL +124%.


The portfolio is beating the SP500 benchmark by 84% in the past 8 months.

It's up 173% in the past 2 years and +184% past 3 yrs.


New action in Top 3 Sector Portfolio:


We purchased the Energy etf XLE on 11/23/20. We also bought a 1/2 position in the banking etf KBE on 11/6/20 in the Top 3 Sector Portfolio. The Energy stocks have

had a few head fakes in the past, but we believe there is longevity in this rally.


We may trim some of our QLD position in the near future if we see additional weakness in Apple, putting proceeds into Banking, and Energy if warranted.



In the Top 7 Stock Portfolio, we bought a position in Apple on 9/21/20.

On 9/28/20 we added Lam Research to the portfolio.


Buy/Sells

Note that our recorded Gains/Losses are based on when we began tracking

the Top 3 Sector Portfolio on the 12/24/18 Xmas Eve low.



New Buys


KBE - B. 1/2 position on 11/6/20 @ $34.08.

XLE - B. on 11/23/20 @ 37.13


New Sells



Sell Stops*





*Sell stops are not indicators of imminent corrections, or a sudden drop in

the market. They are in keeping with our strategy of being pro-active in volatile market conditions, and protecting our investors and their profits.

Important Note: We are now tracking the Top 3 Sector Portfolio performance from

the 3/23/20 March low, in order to show the most recent activity in the last 8 months.


The long term portfolio performance from the 12/24/18 low (1.8 yrs) is published after the "ETF Charts In Top 3 Sector Portfolio" section below. We use both time periods

to select sectors that show increasing momentum.


TOP 3 SECTOR PORTFOLIO

Gain from 3/23/20 low to 11/25/20 (past 8 months)


ETF SECTOR PRICE 3/23/20 % Gain

Index Allocation 34%

QLD (22%) Nasdaq 2x 36.54 180%

IVW (6%) SP500 Growth 144.56 70%


Index Subtotal: 171%


Sector Allocation 57%

ARKK Ark Innovation (15%) 34.78 3/18/20 206%

SOCL Social Media (15%) 25.19 124%

BOTZ Robotics (10%) 15.47 104%

XBI Biotech (3%) 68.57 85%

FDN Internet (9%) 111.72 83%

IGV Software (9%) 190.47 74%

KBE Banking (2%) 34.08 B. 11/6/20 18%

XLE Energy 1/2 position 37.13 B. 11/23/20 7%


Sector Subtotal: 125%

Dividend Stock Allocation 9%

VIG Divid Apprec 2% Div* 89.24 55%


Dividend Stock Subtotal: 55%

International 0%

International Subtotal: 0%


TOTAL RETURN: +146% SP500 +62%

from 3/23/20 low Beating SP500 benchmark by 82%


TOP 7 STOCK PORTFOLIO

From 3/23/20 Low as of 11/25/20 (Past 8 months)

Stock Company Price on 3/23/20 % Gain

AMZN Amazon 1902.83 + 63%

SBUX Starbucks 56.55 74%

MA Mastercard 203.30 68%

MSFT Microsoft 135.98 56%

BLK BlackRock 327.43 114%

AAPL Apple 104.66 (B. 9/21/20) 10%

LRCX Lam Research 331.52 (B. 9/28/20) 35%


Total Return +76% SP500 +62%

from 3/23/20 Low Beating SP500 by 13%



TOP 7 STOCK PORTFOLIO UPDATE

In the Top 7 Stock Portfolio, we bought a position in Apple on 9/21/20.

On 9/28/20 we added Lam Research to the portfolio.


New Buys


AAPL - B. 1/3 position on 9/21 @ 104.66 (we have added to both AAPL and LRCX)

LRCX - B. 1/2 position on 9/28/20 @ 331.52




New Sells





Sell Stops



LONG TERM TOP 3 SECTOR PORTFOLIO PERFORMANCE

FROM 12/24/18 Low - 11/19/20


Here's how Top 3 Sector portfolio has done longer term

from the 12/24/18 low - approximately 1.5 years:



TOP 3 SECTOR PORTFOLIO From 12/24/18 low

Gain from 12/24/18 low to 11/24/20 (1.8 years)

ETF SECTOR PRICE 12/24/18 % Gain


Index Allocation 34%

QLD (28%) Nasdaq 2x 29.18 239%

IVW (6%) SP500 Growth 140.58 70%


Index Subtotal: 227%

Sector 57%


ARKK Ark Innovation 35.34 193%

XBI Biotech 65.42 68%

FDN Internet 107.21 86%

SOCL Social Media 26.60 105%

BOTZ Robotics 16.33 88%

IGV Software 214.22 102%

Sector Subtotal: +154%


Dividend Stock 9%


VIG Divid Apprec 2% Div* 90.55 51%

Dividend Stock Subtotal: 51%


International 0%

International Subtotal: 0%

TOTAL RETURN: +169% SP500 +49%

from 12/24/18 low Beating SP500 by 120%


TOP 7 STOCK PORTFOLIO 1.5 YEAR RETURN

From 12/24/18 Low as of 11/19/20 (Past 1.8 years)

Stock Company Price on 12/24/18 % Gain

AMZN Amazon 1343.96 + 132%

SBUX Starbucks 60.56 61%

MA Mastercard 174.65 92%

MSFT Microsoft 94.13 124%

BLK Blackrock 436.33 54%



Total Return +112% SP500 +52%

from 12/24/18 Low Beating SP500 by 60%



INDEXES:



20 Yr Bond etf - TLT - Broke 50 Week avg, trying to bounce

now. Note the Double Top - classic textbook pattern: 2nd high

on TLT, but RSI diverges. Also MACD sell signal.







SPY Chart: (Blue lines are support)

Fell through the 100 DMA (purple line), then jumped up 10%.






QQQ Chart: Bounces off 100 DMA perfectly,

now above the 21 DMA (green line) by 10%









QLD - 2x Nasdaq etf - Pops 202% from the March low, then rips 17% off the 100 DMA (purple line).















TOP 3 SECTOR PORTFOLIO - HISTORIC PERFORMANCE


Let's look at 3 time periods for performance of our Top 3 Sector Portfolio.

Each period begins with a significant low in the market, so that it's a level playing field


Note how ARKK, QLD, IGV, SOCL, FDN and XBI stayed consistently in the Top 6-7 for

every time period.



Last 7 months - 3/23/20 to 11/20/20

Total Return: +142% SP500 +60%






Last 1.5 years - 12/24/18 low to 11/20/20

Total Return: +173% SP500 +49%






Last 3.5 years - 1/3/17 low to 11/20/20

Total Return: +177% SP500 +57%













TOP 3 SECTOR PORTFOLIO CHARTS

Updated 10/16/20


Please find below all ETFs and Stocks currently in our Top 3 Sector

and Top 7 Stock Portfolios.


ETFs: QLD, ARKK, XBI, BOTZ, SOCL, FDN, IGV, VIG, IVW


Stocks: AMAZON STARBUCKS MASTERCARD MICROSOFT BLACKROCK

APPLE LAM RESEARCH


Moving Average Key for All Charts


Green line: 21 Day Moving average (or Wkly Avg if Wkly Chart)

Orange: 50 DMA

Purple: 100 DMA

Blue: 150 DMA

Red: 200 DMA


Blue horizontal lines represent support or resistance, can also be used for suggested sell stops. Click on each chart to enlarge.




QLD - Up 170% in past 6 months - quite good!








ARKK - Ark Innovation, rose 195% from 3/23/20, our #1 holding in

Top 3 Sector Portfolio:








XBI BIOTECH etf: Stil up 88% from March low. Bounced off

the 150 DMA (blue line) and popped 18%.







ROBOTICS ETF - BOTZ UP 93% from March low:







SOCL Social Media etf - Up 128% from 3/23/20, now on

50 DMA:










Internet ETF - FDN - The "FANG" stocks, nicely up 86%.







Software ETF - IGV up 80% from 3/23/20, watch for possible

double top:






Vanguard Dividend Appreciation VIG. Up 50% past 6 months:









SP500 Growth ETF - IVW, rising 66% past 6 months,

May be stalling out a bit here, didn't breach previous high:










STOCKS IN TOP 7 STOCK PORTFOLIO

Updated 10/16/20


Featuring: AMAZON STARBUCKS MASTERCARD MICROSOFT BLACKROCK

APPLE LAM RESEARCH


Blue Lines (horizontal) are support lines



Amazon ran up 112% from March to 9/2/20.

Still sitting above 21 DMA (green line):






Starbucks roaring up 69% from the March low:






Mastercard ran up 79% from March 2020 through the high,

now falling 15% from there.






Microsoft up 64% from 3/23/20, nice bounce off the 100 DMA:







Blackrock blasting up 103% off the 3/23/20 low:






Apple pops 141% in the past 7 months - one to own for life:





Lam Research

- we bought this recently in our Top 7 Stock Portfolio,

it's up 115% from the 3/23/20 low. Note how it gapped up thru

the previous high in September.







TOP 3 SECTOR PORTFOLIO & TOP 7 STOCK PORTFOLIO PERFORMANCE FROM 12/24/18 LOW



Here's how both portfolios have done from the market bottom

on 12/24/18 to 11/20/20 - approximately 1.9 years:



TOP 3 SECTOR PORTFOLIO From 12/24/18 low

Gain from 12/24/18 low to 10/16/20 (1.8 years)

ETF SECTOR PRICE 12/24/18 % Gain


Index Allocation 34%

QLD (28%) Nasdaq 2x 29.18 247%

IVW (6%) SP500 Growth 140.58 71%


Index Subtotal: 234%

Sector 57%


ARKK Ark Innovation 35.34 188%

XBI Biotech 65.42 68%

FDN Internet 107.21 91%

SOCL Social Media 26.60 111%

BOTZ Robotics 16.33 83%

IGV Software 214.22 106%

Sector Subtotal: +170%


Dividend Stock 9%


VIG Divid Apprec 2% Div* 90.55 46%

Dividend Stock Subtotal: 46%


International 0%

International Subtotal: 0%

TOTAL RETURN: +179% SP500 +46%

from 12/24/18 low Beating SP500 by 133%


TOP 7 STOCK PORTFOLIO

From 12/24/18 Low as of 11/6/20 (Past 1.9 years)

Stock Company Price on 12/24/18 % Gain

AMZN Amazon 1343.96 + 131%

SBUX Starbucks 60.56 60%

MA Mastercard 174.65 85%

MSFT Microsoft 94.13 123%

BLK Blackrock 436.33 54%

APPL Apple 36.04 226%*

LRCX Lam Research 128.15 238% *



Total Return +118% SP500 +48%

from 12/24/18 Low Beating SP500 by 70%


*Prices for Apple and Lam Research are from 12/24/18. Note that

we only recently bought these two, our price was 104.66 and 331.5 respectively.

We excluded their performance in this 1.9 year return which represents only the

remaining 5 stocks..



ALL SECTOR ETFS:

LONG TERM RETURN - From 12/24/18 Market Low

(as of 11/7/20)


Sector ETF Performance Past 1.5 years


Here are all sector ETFs we track with a longer term performance

from the Xmas eve low 12/24/18 through 10/16/20, approximately 1.5 yrs.


BEST:

#1 QLD +236% #2 ARKK +191% #3 SMH Semi's +130%


Worst:

Energy -44%, Airlines -35%, Banks -8%.


The SP500 is now up 48% from the 12/24/18 low.







Best Performing Sector ETFs

Fr 12/24/18 and 3/23/20 low - combined momentum



ETF Rating* Avg % Gain Per year past 4 yrs



ARKK 438 106%

QLD 413 83%

IGV 173 50%


SMH 238 45%

SOCL 228 39%

ITB 230 26%

BOTZ 194 27%

FDN 167 38%

XBI 177 28%

IVW 140 24%


SPY 110 15%



*Rating is a cumulative score based on multiple performance and technical proprietary indicators unique to Top 3 Sector Portfolio.


SELECT STOCK* PERFORMANCE PAST 1.5 YEARS


BEST

#1 ROKU +637% #2 TSLA +609% #3 AMD +400%


WORST

Macy's -78%, HAL -51%, AAL -58%, Boeing -48%.


SP500 is up 48% since the 12/24/18 low:





*This list of "Select Stocks" represents key companies in each sector we track. They are meant to be bellwether indicators, and rather than cram a ton of stocks in just to cover all the favorites, this keeps the list to a minimum, allowing easier observation of where the money is flowing.




Best Performing Stocks 12/24/18 and 3/23/20 Time Periods and Average Yearly gain past 2 yrs:



12/24 + 3/23

STOCK Rating* Avg % Return Per Year


TSLA 2035 335%

ROKU 936 386%

SNAP 773 90

PENN 757 175%

TOL 635

AMD 525 204%

NVDA 505 153%


AAPL 343 113%

NOW 331 28%

PYPL 296 43%

SWKS 267

ASML 248


AMZN 228 36%

ADBE 215 48%

MSFT 196 39%




*Rating is a cumulative score based on multiple performance and technical proprietary indicators unique to Top 3 Sector Portfolio program.





Top 3 Sector Portfolio Strategy

Our investment strategy is unique. In the Top 3 Sector Portfolio, we invest solely in ETFs, both long and short, with an emphasis on Sectors, as they always outperform indexes.


We will also use 2x ETFs, focusing on 6 key indexes only (SSO, QLD, UWM, TWM, QID, SDS) as warranted by market conditions. We do not short sectors.


In addition to the "Top 3 Sector ETF Portfolio," we also feature an all-stock portfolio entitled "Top 7 Stock Portfolio," utilizing the same criteria for selection of stocks as the Top 3 Sector ETF Portfolio.



WHAT DOES "TOP 3 SECTOR" MEAN?


The term 'Top 3 Sector Portfolio' comes from a phenomenon we call the

"Top 3 Effect," where the top 3 sectors that emerge first from a pivot high or low, tend to outperform for longer durations.

After a flush out low, the best ETFs will continue to outperform 2, 3 or 6 months later.​


Here's an example of this effect:​


The first time period is from the 12/24/18 Christmas Eve market bottom to today, 8/24/20, roughly 1 1/2 years. This is a perfect low, as ALL sectors were levelled by the correction. Ground Zero so to speak. What rises first?


The second period is the past 5 months from the much discussed 3/23/20 low

to today, 8/24/20.


Past 1.5 years (from 12/24/28 to 8/24/20:

Table 1



Past 5 months (from 3/23/20 to 8/24/20):

Table 2





Let's look at the first Table (from 12/24/18)


Best 3 ETFs past 1.5 years:


#1 QLD (2x QQQ) +226%

#2 ARKK +154%

#3 ITB (Builders) +98%



When you look at Table 2 - (past 5 months) we see:​

Best 3 ETFs past 5 months:

#1 QLD (2x QQQ) +163%

#2 ARKK +158%

#3 ITB (Builders) +134%



Note the QLD, ARKK (Ark Innovation) and ITB (Builders) are in the top 3 for both time frames.

Point being, that the Top 3 that emerged in the longer 1.5 year time frame, tend to continue that out performance as we see in the shorter time frame.


We will also allocate more capital to the Top 3 ETFs - concentrating resources on the best performing assets which greatly improves our returns.


The top 3-6 will vary a bit, but the first ones off that flush-out low, tend to be the ones still on top 6 months later, and 12 months later, etc.

One other thing to note, the Top 3 tend to 'pull away from the pack'

as time goes on. As time increases, this divergence increases as well.


Note that the Top 3 for the last 1.5 years are up an average of 164%, but the average of the next tier of 3 drops to 96%. The same effect can be seen in the 6 month period.

We have observed this effect over the course of nearly 18 years of trading, giving more credence to the power of the "Top 3 Sector Strategy."


The momentum strategy has been documented by two recent research studies, where stocks that outperformed by a wide margin over a 5 month and 12 month period also delivered a much greater gain longer term. The MTUM Momentum ETF follows a similar strategy.


Here are 3 links to the research done on 3, 6 and 12 month momentum studies:


https://alphaarchitect.com/2016/10/14/how-to-measure-momentum/

https://seekingalpha.com/article/4240540-optimal-lookback-period-for-momentum-strategies

https://www.anderson.ucla.edu/faculty-and-research/anderson-review/momentum



SHORT OR LONG - WE TAKE ADVANTAGE OF THE TREND

The beauty of this strategy is that we make money in both Bull and Bear markets, as we can switch to short ETFs when a positive trend is ending, whereas nearly all mutual funds are long only - giving them a definite disadvantage when markets decline.


SECTORS OUTPERFORM

Since Sectors always outperform indexes, we have a larger portfolio allocation to this area (57%).

For instance, as seen above in Table 2 (from the 3/23/20 low), ARKK is up 158%,

ITB (Builders) is up 134%, while the SP500 is up 52%.


Yes, sectors always outperform indexes. When you note that 92% of all managed funds have not beaten the SP500 index in the last 15 years, it's even more impressive.

In normal market conditions, we allocate as follows:

2 Index ETFs (QLD and IVW)

5 Sector ETFs (This may vary between 4-6 due to mkt conditions)

2 Dividend Stock ETFs (only VIG currently)

2 International ETFs (Currently none)

As of 8/24/20, our portfolio allocation is currently:

Index: 34%

Sector: 57%

Dividend Stock: 9% ​

International: 0%​

This portfolio strategy is aggressive, and is recommended for experienced investors, especially since we employ the 2x ETFs, as well as Inverse ETFs.

THE POWER OF DIVIDENDS

Dividend Yield ETFs are also critical to outperforming the benchmarks.

Investors today are desperate for yield.


We utilize domestic and international dividend stock ETFs (although currently we are in domestic only).


Currently we have VIG for our Dividend Yield allocation. VIG - Dividend Appreciation etf is up 34% the past 3 months, with a dividend of 2%.


Dividends are taxed at only 15%, (for those with incomes less than $250,000/year). Interest income would be in the 22% to 24% in the same earning bracket.

The power of re-invested dividends for total return is simply amazing.

From January 1990 to today (8/24/20), the SP500 is up 767%. Not too bad for a 30 year return.


But wait, add in dividends reinvested, and that SP500 return rises to

an astonishing +1,494% !

Dividends should ALWAYS be reinvested. Always.


Here's a list of Dividend Stock ETFs, as well as some Domestic and

international bond funds that measures performance from the 3/23/20

low to 8/24/20.


Note that our VIG - Vang Dividend Appreciation is up 43% in past 5 months,

with a dividend of 1.74%.







Top 10 Holdings of Top 3 Sector Portfolio ETFs


The Top 10 holdings in Sector ETFs can vary considerably when it comes

to concentration. Some are heavily top weighted, such as Social Media SOCL with over 65% of stocks in top 10, versus XBI Biotech which only has 20% of the ETF in its top 10 stocks.


The QQQ has 57% of its stocks in the top 10 - that concentration helps to explain its outperformance. But a whopping 48% of the QQQ is only 5 stocks: AAPL, MSFT, GOOGL, AMZN and Facebook.



Nasdaq 100 etf - QQQ Top 10: 57% Internet FDN: Top 10: 48%






Social Media SOCL: 10: 65% Software etf - IGV - 10: 57%




Robotics etf - BOTZ Top 10: 60% ARKK Ark Innov. - Top 10: 57%





Biotech XBI: Vang. Div Apprec. etf: VIG

Top 10: 20% Top 10: 32%






SP500 Growth etf - IVW - Top 10 - 39%



























NUALOLO VALLEY, KAUAI






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The information and material contained within the posts and articles appearing at this site are the opinions of the Authors alone and do not constitute a recommendation of any securities, investment strategy or investment transaction. The information and articles appearing at this site are not intended to be and should not be considered investment advice or a recommendation to any user regarding their personal investment needs or economic circumstances. None of the content provided is intended as investment advice regarding any specific security, portfolio of securities, market strategy or investment transaction.


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