(12-21-2021, 06:21 PM)fenders53 Wrote: I am transitioning into retirement. I own some index funds so I don't feel the need to fully diversify my individual stocks. I do have at least a small position in most sectors.
My largest weighted sectors are health care, utilities and defense contractors.
Increasing my technology gradually.
I generally avoid materials.
I own a decent sized position in energy but will never overweight it fir the long-term.
Materials and energy historically do best in a Late phase of the economic cycle,
The late-cycle phase has had an average duration of roughly a year and a half, and overall stock market performance has averaged 6% on an annualized basis. As the economic recovery matures, the energy and materials sectors, whose fate is closely tied to the prices of raw materials, previously have done well as inflationary pressures build and the late-cycle economic expansion helps maintain solid demand.
I historically tend to overweight my investments this sector as Growth begins moderating, credit starts to tighten and earnings begin to fall under pressure and inventories begin to grow.
Hence why I was following PSX and OLN throughout 2021. I would like to possibly begin a position and slowly build into it while out of favor as the market experiences this mid phase (hopefully through the next few years) then rolls into its late phase.
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