Outlier stocks tend to crush the market. They are the 4% of stocks accounting for 100% of the stock market’s gains above treasuries for the last century. Hendrik Bessembinder proved it with his research in his paper “Do Stocks Outperform Treasury Bills?”
That’s why I spend my time crafting portfolios chock full of outlier stocks. If you choose right, you’ll have enormous gains on your hands in the years to come.
Now, I pick my ETFs perhaps a bit differently than other people. I can find outlier ETFs by tracking the Big Money. But that alone isn’t enough: when I catalog the components and find outlier stocks underneath… that’s the winning recipe.
First, I looked at all ETFs making Big Money signals by going to MAPsignals.com and scanning the Big Money ETF Buys and Sells chart. I looked for recent days with heavy buying (the bright blue spikes):
Source: www.mapsignals.com
Once I knew which ETFs Big Money was buying, then I wanted the best opportunities. Remember: ETFs are just baskets of stocks. MAPsignals specializes in scoring more than 6,000 stocks daily. Therefore, if I know which stocks make up the ETFs, I can apply the stock scores to the ETFs. Then I can rank them all strongest to weakest.
So let’s get to the 5 best ETF opportunities for September.
First off, real estate is hot. We can see that Big Money has been plowing money into this ETF over the last year. We saw a few fresh buy signals recently too:
XLRE holds some awesome stocks and one great example is Prologis, Inc. (PLD). Below we see the Big Money signals for PLD:
Next, I’m looking for growth. IVW has it and lots of green signals, too:
One great stock that IVW holds is Microsoft Corp. (MSFT). It has awesome fundamentals and some recent big money buying:
The cloud is a big area for growth this year. CLOU holds some phenomenal stocks. It’s also collecting lots of green:
One big winner that caught my eye inside of CLOU is Netflix, Inc. (NFLX). It’s starting to get its mojo back:
Cathie Woods, the star of Wall Street last year has hit some head winds. The ARKK saw huge buying through February then hit a wall. But the pullback, I believe, is an opportunity because it holds some terrific companies:
It holds a monster growth stock, Square, Inc. (SQ). Big Money has been consistent for years:
The biotech space has been booming. Big Money has been flowing into IBB:
It holds some great stocks too. One that I have my eye on is Regeneron Pharmaceuticals, Inc. (REGN), which has benefited from the COVID pandemic:
Here’s a reminder for what to look for in the charts above:
Let’s summarize here:
IVW, XLRE, & CLOU rank high. ARKK and IBB however, rank lower on our list, mainly due to weaker technicals. That’s why I think these weaker ETFs represent great potential bargains.
IVW, XLRE, CLOU, ARKK, and IBB are my top ETFs for September 2021. Growth, REITs, & cloud stocks have performed well lately. My bet is they continue.
To learn more about MAPsignals’ Big Money process please visit: www.mapsignals.com
Disclosure: the author holds no positions in XLRE, IVW, CLOU, ARKK, IBB, PLD, SQ, or NFLX, but holds long positions in MSFT & REGN in managed accounts at the time of publication.
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Jason is a seasoned equity investor and quantitative analyst. He is currently co-founder of research and analytics firm, MAPsignals.com, focusing on identifying outlier stocks by following the Big Money.