Markets have been hitting record highs for several months, but that doesn’t mean the opportunities are ending – they’ve just changed shape. The real challenge is not to wait for the “right” time to get involved, but to remain flexible while rotating through different areas of leadership. By understanding these movements and managing risk, long-term investors can position their portfolios to pursue emerging themes.
Why opportunities still exist in a strong market?
Even when indices move higher, not all sectors or stocks move in unison. Investors often move capital based on the economic outlook, risk appetite and interest rates, leading to market changes. These changes create new opportunities in the income play, recovery names and structural growth areas that may have been overlooked. Additionally, there are often times when market sentiment lags behind fundamentals. A company may have performed well, but it takes time for the market to take notice. For the cautious investor, this disconnect provides an opportunity to invest before the price reflects its true value…
