Another weird nontrend day. This time we had retail stocks going up. Talk about counter-trend: They define counter-trend. One look at the Fidelity Select Retail fund snapshot in Investors Business Daily's mutual fund leaders page today -- one of my favorites -- told you that this group may have gotten so out of favor that it can't go any lower.
I love looking at these mutual fund charts. They show you how whole sectors are doing better than anything you get from any brokerage.
Today, when I was at the orthopedist trying to figure out how to get my left hand to stop hurting when I type (keyboard angle problem, he says), I had one eye on this Select Retail chart. Fidelity is always fabulous at picking retailers. That has been its stock in trade from the days of
The fund was down an eye-popping 6% going into today's session. That is massive underperformance. And this fund owns the best stocks in the sector!
At our morning meeting, I brought this chart up with
. We have broomed most of these stocks months ago. We hang on to one or two just to keep track of the sector. I used this chart to argue that the group is too washed out to sell anymore any more and if anything, we should be building these stocks next time they get hit.
Again, I don't have a thesis on why to buy these stocks. Yet, I think it is impressive enough that the group is so hated that it probably doesn't pay to hate them any more. Strangely, the whole market seemed to act as I was thinking today.
I don't know if retail has legs right here. One day is still counter-trend. But I am done selling this group for now. It just doesn't get much worse than this.
James J. Cramer is manager of a hedge fund and co-founder of TheStreet.com. At time of publication, his fund had no positions in any stocks mentioned. His fund often buys and sells securities that are the subject of his columns, both before and after the columns are published, and the positions that his fund takes may change at any time. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Cramer's writings provide insights into the dynamics of money management and are not a solicitation for transactions. While he cannot provide investment advice or recommendations, he invites you to comment on his column at