Hey, Ross here:
Everyone naturally pays a lot of attention to the indexes.
But as today’s chart shows…
That may not be the best idea right now.
Chart of the Day
This chart essentially shows correlated S&P 500 stocks are with the S&P 500 index.
In other words, if the index is moving up – or down…
How many stocks in the index are doing the same?
The higher the correlation, the more individual stocks move alongside the index.
And as you can see from the chart above…
Right now, correlations are at the LOWEST they’ve ever been since March 2000.
In other words, it doesn’t matter whether the overall index is moving up or down…
Most stocks are moving independently of the index.
There are some good – and not so good – implications of this.
I elaborate below.
Insight of the Day
The not-so-good implication: Market breadth may be weakening.
The good implication: No matter what happens to the indexes, there will always be opportunities in individual stocks.
The not-so-good implication is that market breadth could keep weakening – even if the indexes keep going up.
In other words, it would be a “fragile” rally.
For the index-only buy-and-hold investors, that’s not a good thing.
But the good implication is that – no matter what’s happening to the indexes…
There will be more opportunities in individual stocks thanks to the record-low correlations.
That’s the opportunity us traders can seize on right now.
Of course, it also means that stock selection is even more important than ever.
I’m going to share a highly controversial – yet devastatingly effective – stock picking strategy with you tomorrow morning.
So keep an eye out for that.
In the meantime, here are the details on two stocks that could double as the “smart money” pours in.
Customer Story of the Day
“I’m not someone that usually leaves reviews, however, if I could give more stars I absolutely would!
I am currently enrolled in two of their courses. I knew NOTHING about the stock market when I joined back in March after seeing Ross on The Cartier Family YouTube Channel.
Ross and Jean have rather quickly taught me how to navigate the market. They are so patient with ‘newbies’ like me and have eagerly answered my questions with demonstrations.
I would highly recommend this down to earth and knowledgeable team to anyone that is on the fence about joining. Just take the leap and watch your wallet grow!”
Ross Givens
Editor, Stock Surge Daily
