Editors' Pick: Originally published Dec. 31.
With just a single trading session left in 2015, the big S&P 500 index is on track to end the year more or less flat from a price standpoint. Today, the S&P is a mere 22 basis points higher than it started back in January -- barely enough to count as a rounding error.
But that's not to say that investors managed to book breakeven performance. While the market averages are nearly unchanged, a big chunk of the individual stocks that make up those indices are deep in the red. As I write, a whopping 39% of S&P components are down 10% or more year-to-date.
Put simply, it's been easy to own some "toxic" performance for your portfolio this year.
And even more stocks are starting to show some cracks as we head into 2016.
To stay a step ahead of the market this winter, we're turning to the charts for a technical look at five big-name stocks that are starting to look toxic.
For the unfamiliar, technical analysis is a way for investors to quantify qualitative factors, such as investor psychology, based on a stock's price action and trends. Once the domain of cloistered trading teams on Wall Street, technicals can help top traders make consistently profitable trades and can aid fundamental investors in better entry and exit points.
Just so we're clear, the companies I'm talking about today are hardly junk. By that, I mean they're not next up in line at bankruptcy court -- and many of them have very strong businesses. But that's frankly irrelevant to what happens to their stocks; from a technical analysis standpoint, sellers are shoving around these toxic stocks right now. For that reason, fundamental investors need to decide how long they're willing to take the pain if they want to hold onto these firms in the weeks and months ahead. And for investors looking to buy one of these positions, it makes sense to wait for more favorable technical conditions (and a lower share price) before piling in.
So without further ado, let's take a look at five toxic stocks to sell.