📈 Buy the Dip on This Sector

Was the sell-off overblown?

Small Caps

Last week we saw a sell-off across the board, including in small caps after weak Non Farm Payrolls data led to fear of a recession.

I see this as an opportunity to buy small caps.

Nobody knows if we are actually headed into a recession or not. However we do know that we are going to see rate cuts.

What sector benefits the most from rate cuts? Regional banks.

16% of the IWM is made up of what sector? Regional banks.

Regional Banks

We saw the same dip in regional banks (KRE) that we saw in the IWM. Again, I see this as a buying opportunity.

While there is a lot of uncertainty surrounding the market with rate cuts looming, economic data worsening, and a pending Presidential election, we can say with certainty that we are going to see rate cuts and that it will positively impact regional banks.

I would keep an eye on these two sectors for buying opportunties.

I talk through this thesis in greater detail here: