Best-Performing Sectors for Fourth Quarter
By Chuck Epstein of InvestorPlace
NEW YORK (
) -- Uncertain markets, poor returns and general fear all helped push investors into bonds in the most recent quarter, leaving many people underexposed to stocks. That may be a mistake.
According to the
Investment Company Research
data, net inflows to bond funds in the first eight months of 2010 totaled $216 billion, compared to net outflows $18 billion for equity funds. Investors have abandoned stocks for some readily understandable reasons. Most notably, as of Sept. 30, the
S&P 500
would still have to rally 37% just to climb back to its all-time high of 1565.15 reached on Oct. 9, 2007.
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But according to Robert F. Carey, CFA, chief investment officer of
First Trust
, Wheaton, Ill., November and December have proven to be the two best-performing months for stocks since 1950. As a result, now may be an opportune time to re-enter the equity market. But that begs the question: Which sector would present the most opportunity?
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Here is a table of the top-performing sectors, including their best and worst years, for the period from 1995 to 2009.
Granted that making comparisons between previous time periods and today is difficult due to the significant recession, high unemployment, weakening dollar and household de-leveraging, past history cannot be readily discounted.
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This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.