The economic signs have been signaling it for some time now. And they continue to point the way in the market: get long growth.
“Instead of looking at a sector, or a ‘great’ stock idea, what we have are style factors,” Hedgeye CEO Keith McCullough says in the video above from The Macro Show this morning.
“What do you want to be long? Quality and growth. You don’t want to be long some pig that’s levered to energy prices. That would make you up half of the returns.”
McCullough added that if you’ve been long U.S. growth this year, you’re likely “killing it.”
“If you’re just long high quality, you’re beating the S&P 500, and you’re definitely beating the Russell because that has a lot of low quality,” McCullough says. “There’s a massive divergence between fast growers and slow growers.”
Meanwhile, growth continues to slow in Europe as evidenced by the release of 10-year Swiss bond yield numbers -- another point we have been calling for since the start of Q3 2017.