Wasan Tita
Evercore ISI analysts said the “alchemy of portfolio construction” in 2024 should have four pillars, according to an Equity and Derivates Strategy macro note.
First, it should have stocks that are “artificial intelligence revolutionaries.” — In other words, companies that are enabling the AI transition or using AI to strengthen their operations.
Second, it should have small cap “standouts,” which are small cap companies with strong momentum and strong EPS, “catalyzed by deep discounts and the June Russell Rebalance, (IWM), (IWF).”
Third, stocks that are “out-perform” rated on communication services (XLC), consumer staples (XLP), and health care (XLV). These are sectors that historically outperform between the Fed’s last hike and its first rate cut.
Fourth, analysts said that “convexity is a ‘must own’ in a technology (NYSEARCA:XLK) driven bull market,” which is going to get more volatile.