I’ve got some new stocks for you to check out today as we kick off a new week in the market.
But before we get to the stock tickers, I need to explain just how big this opportunity could be.
This year, one of the most important industries in the entire market broke out. And while any breakout to a new high is noteworthy, this one carries a special significance.
In the weeks ahead, I expect this breakout to not only give you a chance to profit from rising stock prices. I also expect it to hand you an ever-growing stream of dividend payments.
You’ll definitely want to start buying shares of the stocks we mention today.
And over the next few quarters, these stocks could be responsible for a large part of the extra wealth you earn!
A Breakout Years in the Making
It’s a significant event whenever a stock breaks to a new high — especially if the stock has pulled back and it’s been quite some time since it logged a new high.
Investors who hold positions through a pullback can be fickle. You may have felt this yourself when holding a stock that has pulled back for some time.
“If I can just get back to even, I’ll sell my shares.”
It’s not just novice or inexperienced investors that feel this way either. I remember the feeling of being “stuck” in a position back when I was a hedge fund manager.
And I promised myself that if I could get my clients’ money back, I would sell the stock and find a better opportunity.
This kind of thinking often creates resistance for a stock.
Whenever it gets up to a certain point where most investors can recoup their losses, these investors sell and drive the stock price down again.
So when a stock breaks through that area where many investors are selling, it’s noteworthy.
Reading between the lines, you can assume that most of the people and institutions who want to sell have now unloaded their positions.
And with those sellers out of the way, the stock is now free to keep trading higher.
Breakouts like this can lead to tremendous profits because after this happens, the stock is free from most sellers and can rocket higher.
The concept works for entire industries as well.
And if you have an industry that’s been underwater for a long time (like 13 years or more), a clear breakout can be a watershed event.
Today, we’re going to look at one such industry that just surged to a new high. This clears the way for much bigger profits in the months ahead!
Financial Stocks Finally Get Over the Financial Crisis
I’ll never forget Wall Street’s dark days in 2008. I was working as a hedge fund manager and trying to minimize risk for clients.
At the time, my wife was pregnant with our twins Autumn and Emma. One day I found myself in the delivery room barking, “sell sell sell” into the phone and then turning to my wife and saying, “take a deep breath — you’ve got this.”
That’s when I knew things had to change. And I’m happy to have shifted my career to be focused on YOU here at Rich Retirement Letter.
Those days, the financial sector was under a tremendous amount of pressure.
Bank stocks in particular were absolutely pummelled and caused a lot of investors to lose a tremendous amount of wealth.
In fact, 13 years after the worst days of the crisis, financial stocks are just now breaking above their previous highs.
Take a look at the chart below!
[Note: This chart was posted on Bespoke’s Twitter feed, one of the research services that I follow. And speaking of Twitter, if you want to see some of my day-to-day thoughts on the market, retirement and life in general, check out my own Twitter feed. And while you’re there, click the “follow” button on the top right of your screen!]
The interesting thing about this chart is what happened to tech stocks when they experienced a similar multi-year pullback following the dot-com crash in 2000.
As you can see, once financial stocks broke out to a new high, they spent the next two years moving sharply higher.
That’s a great visual showing how powerful these multi-year breakouts can be!
If financial stocks are poised to surge higher the way tech stocks did starting in 2016, it’s going to be important for you to invest in these names.
That way, you can grow your wealth from this important part of the overall U.S. economy.
Here are three financial stocks to consider adding to your portfolio today.
Three Financial Stocks to Grow Your Wealth
In the coming months, I expect to talk more about financial stocks.
After all, as interest rates rise, the economy picks up, and these companies grow their profits, financial stocks should give investors some exciting returns.
For today, I thought I would start with three stocks in different areas of the financial world that should all do very well in this market season.
First, we’ll start with Regions Financial Corp. (RF). This regional bank should benefit from an overall reopening of the economy, which will lead to more personal and business loans being open.
Banks like RF typically do well when long-term interest rates rise, because they can borrow money cheaply and then generate more profit by lending out the capital at higher rates.
RF will also be able to charge fees for day-to-day financial services that businesses and individuals need.
The stock pays an attractive 2.9% dividend yield. And at 11.2 times next year’s expected profits, shares will also benefit from an overall shift towards value stocks.
My second financial stock for today is a much larger Wall Street investment bank.
JPMorgan Chase (JPM) is a well-respected blue-chip bank that will do very well as the economy reopens.
Not only will the bank be able to serve the day-to-day needs of its deep-pocketed corporate clients. JPM will also profit from helping growth companies raise more capital.
As the market continues to trend higher, JPM can help corporate customers sell shares, issue new bonds, and advise many new IPO transactions. All of these transactions generate lucrative fees.
It may be easy to hate the Wall Street banks, but there’s no question they’re profitable.
Why not tap into those profits by owning shares? The stock currently pays a 2.3% dividend. And if the Fed gives banks a green light to raise dividends, we could see these payouts increase.
The final name I’ll share with you is one of my all-time favorite stocks.
The Blackstone Group (BX) is a private equity company that manages hedge funds and other investment opportunities that are typically only available to the most affluent investors.
BX has a business model that generates profits in three ways.
It charges annual fees to customers who put money into BX funds.
Blackstone also gets to keep a percentage of profits that these funds generate for customers.
And finally, Blackstone invests its own capital into its funds so it profits alongside clients.
Over time, BX has built a financial empire that’s respected by institutional investors around the world.
The stock pays a 3.1% dividend yield. These payments fluctuate depending on the profits BX generates each year.
So there you have it!
Three stocks that are set to surge higher as financial stocks break out. Make sure you invest some of your retirement wealth in this area so you can profit from this new development!
Oh, and don’t forget to follow me on Twitter to keep up with the market, your retirement opportunities — and maybe the occasional dad joke!