We expect major indexes to remain supported into late February, with certain indexes making new all-time highs while others retest and fall short of their November peaks. Choppy price action is expected to be seen into month-end, making for a frustrating trading environment for short term traders. We expect part of this price action will be due to smart money distributing long positions over the next 4-6 weeks prior to a major correction starting in late Q1 2022. We will deviate from our normal weekly briefing and cover our model IRA portfolio. Many astute famous money managers and investors have stated that the accounts they don’t actively manage often outperform the ones they trade. In our opinion, IRA accounts and long term portfolios often perform best with investment horizons of 3-5 years. Below, you will find the asset classes we expect to outperform over the next 3-5 year time period. We prefer ETF’s whenever possible, taking company-specific risk out of the investment equation.
The following sectors are highlighted below:
Expect continued supply restriction and anti-exploration legislation from global governments as the green agenda forges on. Crude oil hit $147 in 2008 and this price level should be tested into 2023. OIH covers a broad range of oil services companies.
QQQ will give your portfolio weighting in technology as it largely consists of the mega-tech names which will be the leaders in artificial intelligence over the coming years.
More and more items made in the world continue to necessitate semiconductors. This trend will only continue into the coming years.
Of all precious metals and miners, we have the strongest conviction on silver’s industrial and monetary use in the coming years. A retest of the 2011 highs is the first step, likely followed by a break of $150 in the next 2-5 years.
Bitcoin is the mother of all cryptocurrencies and continues to share the store-of-value trade with gold. No more Bitcoin will be printed or mined in the near future. 3-5 year targets can see 200k-400k.
New technology will lead to new cures and treatments for humans benefiting big Pharma and the biotech industry the next 3-5 years.
In closing, the aforementioned assets can all experience rough consolidation periods of 6-12 months over the next 5 years. Trying to time every wiggle for long term portfolios or retirement accounts is challenging. Many investors have gone with a hybrid approach to investing in recent years by maintaining three different portfolios listed above: retirement, active, and longterm buy-and-hold accounts. Investing is a personal choice and ultimately people trade to their personalities, but shorter term investors should not overlook big picture estate planning with retirement investment accounts and long term portfolios.