by Jason Bodner
April 18, 2023
You might imagine that while I work, CNBC is blaring in the background, along with flickering digital ticker tape flying by on several other screens. Well, that’s my history: I spent nearly 15 years on trading desks in that exact scenario, with added screaming on phones and frenetic trading all day long, so when I struck out on my own, one would think I tried to replicate that environment. But not so: I don’t watch the news. My current environment is a large, spacious, quiet room, with “chill” music, and two dozing dogs.
My workday more closely resembles a quiet, cool hotel lounge than a trading desk. It allows me to think creatively and analyze data without the influence or noise of endless opinions and the posturing biases of the media. Instead of Cramer, I am currently listening to some smooth soul of The Fabulous Three.
News, of course, serves to inform us, but at least 80% of it depends on ads. It is designed to sell products for advertisers. That’s why I am leery of much of what they produce. After all, if we based our decisions on news stories, we might never leave our house again. And if we were lucky enough to live another day, we might worry about the destruction of our planet and the end of life as we know it within a year or two.
So, should we invest the way they tell us – being constantly influenced by emotional stories of fear and greed impacting stock prices? To do so would be to think that business values fluctuate wildly day to day. That is crazy, if you think about it, but wild news stories and rumors push stock prices up and down daily.
I suppose many of you reading this are business owners yourselves. Imagine if your dry-cleaning business were worth $1 million on Tuesday, but on Wednesday a news story came out bashing the environmental impact of the dry-cleaning industry and now your business is worth $800,000. But Thursday rolls around and a puff piece about green-dry-cleaning jacks up the new price of your business to $1.1 million.
It’s nonsense, right? But I just described most stocks and sectors, from time to time, in the stock market. Volatility is a trader’s lifeblood. Prices move around wildly, so profits can potentially be captured. But that’s not where the real money is. As Jesse Livermore put it a century ago, the real money is “in the sitting.” That means buying great businesses at good prices and holding them for a reasonable time as a proven method of investing. Perhaps the buy-and-hold “forever” days are dead, at least for now, but you can’t make money on a stock you own without holding it at least for some reasonable amount of time.
If we can’t rely on news to drive our decisions, then what do we do? Well, by now you know that I rely on data. And while the news is giving us conflicting stories about inflation, interest rates, wars, disease, politics, and other distractions, the market is giving us signs right now of what’s likely to come.
First let’s look at the Big Money Index (BMI). Its drop was halted just above “oversold,” and it has since been rising steadily. What’s interesting is what MAPsignals’ Alec Young pointed out last week, in his analysis of the BMI, when he wrote: “Don’t Rule Out New Highs.” As it tracks trends of money flows, BMI readings of 80+ are “overbought” and we can expect a pullback. But when the BMI drops below 25, we are oversold. “That’s when the baby’s being thrown out with the bathwater and stocks are a big time buy.” Right now, since bouncing off just above oversold, the BMI forecasts more upside than downside:
Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.
This is mainly due to the evaporation of heavy selling, caused in no small part by the banking collapses and fear of contagion. And that’s making way for some light but intensifying buy signals:
Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.
And that recent buying has been focused heavily in small- and mid-cap stocks.
Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.
That’s a healthy sign. If there were true fears from investors about a catastrophic recession, would they be gobbling up small businesses? What’s even more promising is that the sector leadership has a strong growth component. Look at the highest-ranked sectors, which are now tech and discretionary:
Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.
The laggards continue to be the financials, due to the banking woes, and real estate, due to interest rates. As rates will likely come down next year, I wouldn’t write off real estate for dead. And banks always find a way to survive, as evidenced by the latest lifelines extended to the banks and their depositors.
Now, as we turn to the breadth of individual sectors, we see a common theme: selling is dissipating and giving way to some buying. The intense red (selling) was focused heavily on most sectors except tech and discretionary. Energy and health care’s recent recoveries undid much of the damage done near the Ides of March. Perhaps even more interesting is the fact that buying is beginning to sprout in every sector, except for poor real estate. Perhaps it is there that value seekers might look for deals on great businesses getting punished along with the overall sector. PCH, IIPR, PSA are names that warrant further study in this area.
Graphs are for illustrative and discussion purposes only. Please read important disclosures at the end of this commentary.
I know I harp on this theme often – the demonization of the news – but it’s a central theme to my view on investing and life in general: Seek objectivity. Decisions based on emotions may have served us well as human primates. Instinct kept us alive. But now, in a more analytical world, we must adopt a data-driven approach. And investing certainly should be based on data analysis, with little input from our emotions.
Remember that Jesse Livermore quote: “Money is made by sitting, not trading.”
All content above represents the opinion of Jason Bodner of Navellier & Associates, Inc.
Also In This Issue
A Look Ahead by Louis Navellier
The First-Quarter Earnings Outlook Remains “Mixed,” At Best
Income Mail by Bryan Perry
Massive Paper Losses Turn Banks into a “Zombie” Sector
Growth Mail by Gary Alexander
Investors Follow the Money While Politicians Fail at Basic Math
Global Mail by Ivan Martchev
What’s Behind the New 2023 VIX Closing Low?
Sector Spotlight by Jason Bodner
Finding Answers in Quiet Data Mining – Not Manic News Noise
View Full Archive
Read Past Issues Here

Jason Bodner
MARKETMAIL EDITOR FOR SECTOR SPOTLIGHT
Jason Bodner writes Sector Spotlight in the weekly Marketmail publication and has authored several white papers for the company. He is also Co-Founder of Macro Analytics for Professionals which produces proprietary equity accumulation/distribution research for its clients. Previously, Mr. Bodner served as Director of European Equity Derivatives for Cantor Fitzgerald Europe in London, then moved to the role of Head of Equity Derivatives North America for the same company in New York. He also served as S.V.P. Equity Derivatives for Jefferies, LLC. He received a B.S. in business administration in 1996, with honors, from Skidmore College as a member of the Periclean Honors Society. All content of “Sector Spotlight” represents the opinion of Jason Bodner
Important Disclosures:
Jason Bodner is a co-founder and co-owner of Mapsignals. Mr. Bodner is an independent contractor who is occasionally hired by Navellier & Associates to write an article and or provide opinions for possible use in articles that appear in Navellier & Associates weekly Market Mail. Mr. Bodner is not employed or affiliated with Louis Navellier, Navellier & Associates, Inc., or any other Navellier owned entity. The opinions and statements made here are those of Mr. Bodner and not necessarily those of any other persons or entities. This is not an endorsement, or solicitation or testimonial or investment advice regarding the BMI Index or any statements or recommendations or analysis in the article or the BMI Index or Mapsignals or its products or strategies.
Although information in these reports has been obtained from and is based upon sources that Navellier believes to be reliable, Navellier does not guarantee its accuracy and it may be incomplete or condensed. All opinions and estimates constitute Navellier’s judgment as of the date the report was created and are subject to change without notice. These reports are for informational purposes only and are not a solicitation for the purchase or sale of a security. Any decision to purchase securities mentioned in these reports must take into account existing public information on such securities or any registered prospectus.To the extent permitted by law, neither Navellier & Associates, Inc., nor any of its affiliates, agents, or service providers assumes any liability or responsibility nor owes any duty of care for any consequences of any person acting or refraining to act in reliance on the information contained in this communication or for any decision based on it.
Past performance is no indication of future results. Investment in securities involves significant risk and has the potential for partial or complete loss of funds invested. It should not be assumed that any securities recommendations made by Navellier. in the future will be profitable or equal the performance of securities made in this report. Dividend payments are not guaranteed. The amount of a dividend payment, if any, can vary over time and issuers may reduce dividends paid on securities in the event of a recession or adverse event affecting a specific industry or issuer.
None of the stock information, data, and company information presented herein constitutes a recommendation by Navellier or a solicitation to buy or sell any securities. Any specific securities identified and described do not represent all of the securities purchased, sold, or recommended for advisory clients. The holdings identified do not represent all of the securities purchased, sold, or recommended for advisory clients and the reader should not assume that investments in the securities identified and discussed were or will be profitable.
Information presented is general information that does not take into account your individual circumstances, financial situation, or needs, nor does it present a personalized recommendation to you. Individual stocks presented may not be suitable for every investor. Investment in securities involves significant risk and has the potential for partial or complete loss of funds invested. Investment in fixed income securities has the potential for the investment return and principal value of an investment to fluctuate so that an investor’s holdings, when redeemed, may be worth less than their original cost.
One cannot invest directly in an index. Index is unmanaged and index performance does not reflect deduction of fees, expenses, or taxes. Presentation of Index data does not reflect a belief by Navellier that any stock index constitutes an investment alternative to any Navellier equity strategy or is necessarily comparable to such strategies. Among the most important differences between the Indices and Navellier strategies are that the Navellier equity strategies may (1) incur material management fees, (2) concentrate its investments in relatively few stocks, industries, or sectors, (3) have significantly greater trading activity and related costs, and (4) be significantly more or less volatile than the Indices.
ETF Risk: We may invest in exchange traded funds (“ETFs”) and some of our investment strategies are generally fully invested in ETFs. Like traditional mutual funds, ETFs charge asset-based fees, but they generally do not charge initial sales charges or redemption fees and investors typically pay only customary brokerage fees to buy and sell ETF shares. The fees and costs charged by ETFs held in client accounts will not be deducted from the compensation the client pays Navellier. ETF prices can fluctuate up or down, and a client account could lose money investing in an ETF if the prices of the securities owned by the ETF go down. ETFs are subject to additional risks:
- ETF shares may trade above or below their net asset value;
- An active trading market for an ETF’s shares may not develop or be maintained;
- The value of an ETF may be more volatile than the underlying portfolio of securities the ETF is designed to track;
- The cost of owning shares of the ETF may exceed those a client would incur by directly investing in the underlying securities; and
- Trading of an ETF’s shares may be halted if the listing exchange’s officials deem it appropriate, the shares are delisted from the exchange, or the activation of market-wide “circuit breakers” (which are tied to large decreases in stock prices) halts stock trading generally.
Grader Disclosures: Investment in equity strategies involves substantial risk and has the potential for partial or complete loss of funds invested. The sample portfolio and any accompanying charts are for informational purposes only and are not to be construed as a solicitation to buy or sell any financial instrument and should not be relied upon as the sole factor in an investment making decision. As a matter of normal and important disclosures to you, as a potential investor, please consider the following: The performance presented is not based on any actual securities trading, portfolio, or accounts, and the reported performance of the A, B, C, D, and F portfolios (collectively the “model portfolios”) should be considered mere “paper” or pro forma performance results based on Navellier’s research.
Investors evaluating any of Navellier & Associates, Inc.’s, (or its affiliates’) Investment Products must not use any information presented here, including the performance figures of the model portfolios, in their evaluation of any Navellier Investment Products. Navellier Investment Products include the firm’s mutual funds and managed accounts. The model portfolios, charts, and other information presented do not represent actual funded trades and are not actual funded portfolios. There are material differences between Navellier Investment Products’ portfolios and the model portfolios, research, and performance figures presented here. The model portfolios and the research results (1) may contain stocks or ETFs that are illiquid and difficult to trade; (2) may contain stock or ETF holdings materially different from actual funded Navellier Investment Product portfolios; (3) include the reinvestment of all dividends and other earnings, estimated trading costs, commissions, or management fees; and, (4) may not reflect prices obtained in an actual funded Navellier Investment Product portfolio. For these and other reasons, the reported performances of model portfolios do not reflect the performance results of Navellier’s actually funded and traded Investment Products. In most cases, Navellier’s Investment Products have materially lower performance results than the performances of the model portfolios presented.
This report contains statements that are, or may be considered to be, forward-looking statements. All statements that are not historical facts, including statements about our beliefs or expectations, are “forward-looking statements” within the meaning of The U.S. Private Securities Litigation Reform Act of 1995. These statements may be identified by such forward-looking terminology as “expect,” “estimate,” “plan,” “intend,” “believe,” “anticipate,” “may,” “will,” “should,” “could,” “continue,” “project,” or similar statements or variations of such terms. Our forward-looking statements are based on a series of expectations, assumptions, and projections, are not guarantees of future results or performance, and involve substantial risks and uncertainty as described in Form ADV Part 2A of our filing with the Securities and Exchange Commission (SEC), which is available at www.adviserinfo.sec.gov or by requesting a copy by emailing info@navellier.com. All of our forward-looking statements are as of the date of this report only. We can give no assurance that such expectations or forward-looking statements will prove to be correct. Actual results may differ materially. You are urged to carefully consider all such factors.
FEDERAL TAX ADVICE DISCLAIMER: As required by U.S. Treasury Regulations, you are informed that, to the extent this presentation includes any federal tax advice, the presentation is not written by Navellier to be used, and cannot be used, for the purpose of avoiding federal tax penalties. Navellier does not advise on any income tax requirements or issues. Use of any information presented by Navellier is for general information only and does not represent tax advice either express or implied. You are encouraged to seek professional tax advice for income tax questions and assistance.
IMPORTANT NEWSLETTER DISCLOSURE:The hypothetical performance results for investment newsletters that are authored or edited by Louis Navellier, including Louis Navellier’s Growth Investor, Louis Navellier’s Breakthrough Stocks, Louis Navellier’s Accelerated Profits, and Louis Navellier’s Platinum Club, are not based on any actual securities trading, portfolio, or accounts, and the newsletters’ reported hypothetical performances should be considered mere “paper” or proforma hypothetical performance results and are not actual performance of real world trades. Navellier & Associates, Inc. does not have any relation to or affiliation with the owner of these newsletters. There are material differences between Navellier Investment Products’ portfolios and the InvestorPlace Media, LLC newsletter portfolios authored by Louis Navellier. The InvestorPlace Media, LLC newsletters contain hypothetical performance that do not include transaction costs, advisory fees, or other fees a client might incur if actual investments and trades were being made by an investor. As a result, newsletter performance should not be used to evaluate Navellier Investment services which are separate and different from the newsletters. The owner of the newsletters is InvestorPlace Media, LLC and any questions concerning the newsletters, including any newsletter advertising or hypothetical Newsletter performance claims, (which are calculated solely by Investor Place Media and not Navellier) should be referred to InvestorPlace Media, LLC at (800) 718-8289.
Please note that Navellier & Associates and the Navellier Private Client Group are managed completely independent of the newsletters owned and published by InvestorPlace Media, LLC and written and edited by Louis Navellier, and investment performance of the newsletters should in no way be considered indicative of potential future investment performance for any Navellier & Associates separately managed account portfolio. Potential investors should consult with their financial advisor before investing in any Navellier Investment Product.
Navellier claims compliance with Global Investment Performance Standards (GIPS). To receive a complete list and descriptions of Navellier’s composites and/or a presentation that adheres to the GIPS standards, please contact Navellier or click here. It should not be assumed that any securities recommendations made by Navellier & Associates, Inc. in the future will be profitable or equal the performance of securities made in this report.
FactSet Disclosure: Navellier does not independently calculate the statistical information included in the attached report. The calculation and the information are provided by FactSet, a company not related to Navellier. Although information contained in the report has been obtained from FactSet and is based on sources Navellier believes to be reliable, Navellier does not guarantee its accuracy, and it may be incomplete or condensed. The report and the related FactSet sourced information are provided on an “as is” basis. The user assumes the entire risk of any use made of this information. Investors should consider the report as only a single factor in making their investment decision. The report is for informational purposes only and is not intended as an offer or solicitation for the purchase or sale of a security. FactSet sourced information is the exclusive property of FactSet. Without prior written permission of FactSet, this information may not be reproduced, disseminated or used to create any financial products. All indices are unmanaged and performance of the indices include reinvestment of dividends and interest income, unless otherwise noted, are not illustrative of any particular investment and an investment cannot be made in any index. Past performance is no guarantee of future results.