Industrials and Materials
2 sectors that should be underweight
Last week we saw the stock of 3M revisit their 2013 prices. That’s quite a move to the downside for a Dividend Aristocrat.
While I realize that 3M has their own set of mishaps and concerns, this got me thinking about Industrials, which has been one of the strongest sectors in the last few months. Over the last 6 months, Industrials have been the second best performing sector of all the S&P Sectors and materials the fourth.
I was surprised to see some of the top performers in the Industrial Sector Fund over the last 6 months:
Nevertheless, we’ve come to the point in the business cycle where the Industrials and Materials begin to fall out of favor and as sector allocations they should be underweight in your portfolio.