Investors must be very demanding in the short term when buying stocks. As he S&P 500 As the Dow Jones on Wall Street; and the Dax and the Stoxx 600 in Europe, they are trading at all-time highs, causing retailers the so-called FOMO syndrome (fear of missing out); the fear of staying out of the market as it rises and rises.
Therefore, it is necessary don't get blinded by bag holders at highs and analyze the market with perspective. “Our expectation of a progress in equities slower from here, a shrinking set of opportunities and one decreasing stock correlation suggests the need for investors to be more selective"They point out from Morgan Stanley.
Thus, these experts advise focusing on the actions with “best risk / benefit ratio"and become a“title selector”. According to his assessment, the best opportunities are currently in pharmaceutical and utilities, while the worst are in automobiles, transportation, hardware, and capital goods.
Within a list of almost 60 shares that they drive and that has a upside potential greater than 10%, stand out as a Spanish value Endesa and they also bet on other European actions such as Eiffage, SSE, Leonardo, Prosus, National Grid, EDF, Sanofi, BT, Carrefour, Swedish Match, Vodafone, Phoenix Group, Credit Suisse, Tesco, Breedon Group, MAN Group, Munich Re, Rheinmentall and Aveva.
All of them meet several essential conditions to bet on them in the current scenario. Bank analysts advise buy them, they have a 10% minimum upside potential about its current market price and also double the possibility of moving in a bullish scenario than in a bearish one.
Morgan Stanley has also taken into account whether the stock seems relatively cheap compared to its track record, and the possibility of having their earnings targets revised upwards for 2022.
The conclusion is that you do not have to buy to buy nor enter the market dragged by the fear of being left out, but it is necessary carry out a detailed analysis of the most attractive options at all times. The objective, as always, is to maximize the return on investments, but always trying to preserve the capital that we have.
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