Worthy Of A Rest?

There are always two trains of thought depending on your bias. With one look below at the annual major S&P sector performance chart by Novel Investor, what must pop out are the incredible gains information technology recorded in the last couple of years of 50 and 44% respectively. In fact 11 of the last 12 years the XLK rose, and the lone exception would be 2018, where it lost ever so fractionally less than 1%. Bulls in this scenario would declare, stay with what’s working, and bears would most likely proclaim a prudent pause would be the healthy thing to do. If one were to look at the current leaderboard for these same sectors now, the XLK would be “just” the 8th best of 11, higher by almost 10%. Is that enough of an interlude to satisfy the bears? Are the bulls content with the “mediocre” advance thus far in 2021 comparing to the prior two years? As always try to find which sub-sectors within technology are working and find the best actors within those small niches. “Old tech” and semis fit the bill.

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