Dear Reader,
A couple days ago, I introduced you to one of the most effective ways to create income in the market.
At the time, I also said that I had some thoughts I would share with you later about Tuesday’s debate between former President Trump and Vice President Harris.
And, since this week’s mailbag is a bit lighter than expected, that’s exactly what I want to do right now…
Over 67 million people tuned in for what some news networks were projecting to be the biggest TV event in history. While their estimates fell short, a lot more people watched this one than they did back in June.
For me, it wasn’t about who goes on the offensive, who looks better prepared, who promises more, or who ends up with the best one-liners. It was (and still is) about the policies put forth that are best for my family, my business, the future, and more… things that were (and are) likely on your mind as well.
But, as a trader, my first thought is which stocks or industries are likely to benefit if Trump wins… if Harris wins… or if either wins?
And here’s who came out on top…
If Tuesday’s debate performance results in a Trump win, oil and gas, financial, and defense stocks would benefit the most due to his proposed policies and campaign promises. Think of stocks like Exxon Mobil Corporation (XOM), Bank of America Corporation (BAC), and RAYTHEON TECHNOLOGIES CORP (^RTX), to name a few.
On the other hand, a Harris win would likely benefit clean energy, technology, and education stocks the most, like Empatho Holdings Inc. (EMPHF), Microsoft Corporation (MSFT), and Salesforce, Inc. (CRM).
But the REAL winner, regardless of the outcome, is healthcare. Period.
To be clear, I don’t see our country moving to an entirely government-run plan. Healthcare costs will rise as long as we continue to subsidize healthcare companies with taxpayer dollars. It’s simple math… Wherever the money goes, price increases will follow.
But healthcare will continue to be a dominant part of the political conversation – before and long after the election.
And the number one stock to benefit? UnitedHealth Group Incorporated (UNH).
UNH is the top stock in the healthcare industry. It’s the 800lb gorilla in this sector, and its stock price is up over 19,000% since its initial public offering (IPO) back in October 1984. As a company, it’s logged better returns than any other I researched during this same time frame. And, as baby boomers continue to age, this UNH should continue to grow in stock price over the next decade.
Now… the biggest loser after last night’s debate? The U.S. dollar.
The USD burn rate is about 8% per… meaning the dollar loses 8% of its value each year on average, regardless of who’s in office. Unfortunately, the interest on our national debt alone is now larger than any policy, gift, war, and anything else I can think of.
So, as an investor, you have to think about a long-term, buy-and-hold asset that can return 8% per year – untaxed. If you’re a long-term trader who exits positions with long-term capital gains, you’ll want to increase that number to 9.6%. And, a short-term trader… Well, you have to make between 11% and 13% per year to cover the taxes for your short-term gains.
And that’s just to break even.
That’s why the worst thing that you can do is sit around buying and storing cash. You need to put it to work in something that makes money….
And next week, we’ll talk about exactly what that is.
Until then, enjoy your weekend!
Tom Gentile
America’s Pattern Trader