Trade Alert – Equity And ETF Model
In August, we reduced our positions in Diamondback Energy (FANG), ExxonMobil (XOM), and the iShares Energy ETF (XLE). At that time, oil prices were elevated, and we were beginning to see deflationary economic pressures arising. Since then, those deflationary pressures have continued, as reflected in indices such as the CFNAI and LEI. While those deflationary pressures continue, particularly from every other global economy, energy stocks have become extremely oversold. Therefore, we are returning our energy positions to target weights from underweight for a potential tradeable rally into early next year.
Equity Model
- Increase Diamondback Energy (FANG) and Exxon Mobil (XOM) to target allocation weights of 2% and 1.5% of the portfolio respectively.
ETF Model
- Increase the iShares Energy ETF (XLE) to a target weight of 4% of the portfolio.
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Lance Roberts is a Chief Portfolio Strategist/Economist for RIA Advisors. He is also the host of “The Lance Roberts Podcast” and Chief Editor of the “Real Investment Advice” website and author of “Real Investment Daily” blog and “Real Investment Report“. Follow Lance on Facebook, Twitter, Linked-In and YouTube
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