Don’t Just Play the Market — Beat the Market

by Andrew Zatlin

I hope you’ve been following my advice!

I’ve been bullish for a while now. If you’ve been listening, you might be sitting on double-digit gains.

Today, I’ll show you why it’s not too late to get in — and where you should be focusing for maximum profits.

For a transcript of this video, see below. This transcript has been lightly edited for length and clarity.

Don’t Just Play the Market — Beat the Market

The market is up two-and-a-half percent in the past six weeks. That’s solid.

Meanwhile, it’s up 10% since things bottomed out in mid-October.

If you’ve been following my advice, you might be sitting on gains like this yourself.

But today, I’ll tell you how to do even better…

I’ll explain how to beat the market.

Hiring = Growth

It all centers around my hiring data.

If you’re a longtime listener or reader, you know my stance about how important this data is:

Companies that are growing are hiring. Companies that are shrinking aren’t.

It’s that simple.

So, to determine which companies and which sectors are poised for growth, we need to follow hiring activity. Because where there’s growth, there’s almost always money to be made.

In fact, take a look at this…

A Strong Correlation

 

This chart shows the correlation between hiring activity (in orange) and the S&P 500 (in blue).

Over the past eight years, these two have been tightly correlated. In other words, when hiring activity jumps, so does the S&P 500.

Don’t put too much stock into that diversion in 2020. COVID was a once-in-a-lifetime external shock that resulted in a major drop in hiring. And remember, trillions of dollars were thrown at the stock market to keep it going.

But notice: once all the money stopped being thrown around and things returned to normal, the correlation resumed. And pay attention to the far right-hand side.

Hiring in 2023 has been lackluster. And so has the overall growth of the S&P 500.

But that’s about to change. In fact, this change is already underway…

Year of the Bull

Here’s a look at my hiring index for companies in the S&P 500:

 

Again, the past year or so has been rough. But see how the most recent data is trending up?

That tells me that companies have their feet off the hiring brakes. Sure, not all of them may be pressing the gas pedal quite yet, but this inflection is a major bullish indicator. And it tracks with my projection that 2024 will be the Year of the Bull.

But here’s the thing: A lot of investors might see my data and jump right into the market. After all, that’s how you’ll earn the returns the S&P 500 will deliver.

But remember, we’re after market-beating returns. And the way to achieve that is to identify pockets of strength and weakness in the broader market…

And that’s where my hiring data becomes even more powerful.

A Booming Sector

You see, certain sectors are doing better than others. And by using my hiring data to identify them, we can make targeted investments with greater profit potential.

For example, look at year-over-year hiring for the construction industry, as tracked through the ITB exchange-traded fund (ETF):

Since July 2023, hiring has surged, which makes sense. After all, home inventory is low. So most people wanting to buy a home are forced to look at new construction.

Furthermore, builders locked in materials experiences last year at miniscule interest rates. That means their costs are lower than usual, and they can afford to pass along some savings to potential buyers, creating even more work for this sector.

Now let’s compare this hiring activity to ITB’s stock-price performance:

 

For much of this year, the market was pushing down this fund’s stock price, despite hiring activity trending up. That’s not surprising — Wall Street doesn’t understand the hiring data like I do.

But look what’s finally happened. This ETF has soared in recent weeks. In fact, this fund is up 20% and approaching a twelve-month high. If you’d invested in this fund based on my hiring data, you’d be sitting on major gains.

And remember, hiring data can not only tell us which sectors to target, but also which ones to avoid…

Steer Clear

Here’s year-over-year hiring for the consumer-goods sector, as tracked through the IYK ETF:

 

As you can see, hiring activity has been dismal this year, and continues to drop. Yet look at the one-year chart of IYK’s stock price:

Notice how it’s trending up? That’s a false flag, in my opinion. When in doubt, trust the hiring data. And the hiring data tells us that it’s not quite turnaround time yet. Consider selling into this fund’s recent rise.

The Key Takeaway

Hiring data is essential to beating the market.

Not only can it tell us when to get in or out, but it can also tell us which sectors or companies to target for maximum profit potential.

I’ve leveraged this data to reveal a specific investment idea, but the details are only for my Pro readers. So don’t miss out.

We’re in it to win it. Zatlin out.

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