Earlier today I posted a list of some of the best stocks in the world right now.
Read it out loud and it sounds like a pharmacy receipt.
Drugmakers. Biotech. Two insurance companies. A cigarette company. A lab that does your blood work.
So I asked the only question that matters: is this a strong bull market?
Earlier this month I told you your grandparents' favorite stocks were winning. They brought friends.
The black line is the technology sector. The blue line is health care. Both start at 100 on October 6, the day the Nasdaq 100 peaked.
Since then technology is down 14.0%. Health care is up 12.4%.
This isn't everything falling apart. The equal-weight S&P 500, which counts every stock the same, is up 4.0% over that stretch. The regular S&P 500 is down 2.8%. The market didn't break. It changed leaders.
But we're here to make money. So who's leading now, and what do you do about it?
The Crowd Wants Its Ex Back
Each bar is one week of money going into or out of the two largest Nasdaq 100 funds. Blue is money coming in. Red is money leaving.
Look at the last bar. In the week through Wednesday, November 11, those funds took in $13.2 billion. That's the most in any week since January 2019.
That week started with the Nasdaq 100's worst day of the year.
The money is chasing the old leaders. The price is paying the new ones.
Human beings are insane. I may have mentioned this.
Now here's the list.
These 18 stocks have two things going for them. The Flow Score says the stock itself is strong: trend, strength against the market and momentum. The Flow Rank says fund money is reaching it. Both are 80 or higher out of 100, and each stock is beating the market and its own sector over the past 20 days.
Count them. Eleven of the 18 are in health care. Add two insurers and a tobacco company and you're at 14. One chipmaker made it, and it isn't Nvidia.
The flow tells you where money went. It doesn't tell you what a stock does next. So read it next to price, never in place of it.
This is one table from the Flow Report, which members get every Friday.
About as Exciting as a Waiting Room
This is Johnson & Johnson, third on the list. Nobody has ever bragged about owning it at a party.
On the day the Nasdaq 100 fell 6.4%, it fell 1.4%. Today it closed at $285.75, its highest close ever. Its Flow Score is 90 and its Flow Rank is 98.
I bet you didn’t have that as a list of long winners in the middle of an AI bubble.. did you? Don’t lie.
So What Am I Doing About It?
Less, and different.
On new trades I'm at half size. Our portfolio posture inside of Flow Pro is Reduce Aggression: the S&P 500 and the Nasdaq 100 are both in pullbacks, and the risky stocks are losing badly to the safe ones.
I said last week I'm not afraid to bail on a thesis when the market changes. This is the market changing.
So I'm shopping from this list, not the one I wish were working. Not sexy. I'll live.
And yes, I bought Nvidia on Monday. It is not on the list.
Strong bull market? Ask me again when the list stops looking like a pharmacy receipt.
Members got the full Flow Report on Friday: where the financial institutional money went last week across all 11 sectors and 166 industries, the charts behind this list, and the stocks that are losing their fund money.
That's the Flow System. It answers four questions before you buy: where the money is going, what to buy, when to act and how much to risk. Flow Pro members get those answers on every trade alert, plus three live coaching sessions a week where I'll talk your ear off about all of it.
If you'd like the whole report before your next trade, here it is. Pharmacy receipt included.
Follow the money,
Hamilton
Founder, The Trading Initiative
For education and information, not personalized trading advice. Trading involves risk of loss. Options can lose their entire premium. Past performance does not guarantee future results.