These stocks should do even better than the S&P 500 once the Fed pivots to lower interest rates
By Mark Hulbert
Fed easing could weaken the U.S. dollar, which favors non-U.S. markets and dollar-based investors
Investing in the S&P 500 Index is not the best way to profit from an anticipated Fed pivot. Not because U.S. equities won’t rally when the Federal Reserve decides to reduce the pace of its rate hikes. They probably will.
But another category of stocks is quite likely to be an even better performer for a U.S. dollar-based investor.
I’m referring to international equities. It’s a good bet that the U.S. dollar’s strength against other currencies will weaken after a Fed pivot, and if that happens, an investment in non-U.S. stocks will earn a double return — both from the stocks themselves and from the appreciation of those stocks’ local currencies vis-à-vis the dollar.
The past couple of months provide a powerful illustration of this double-return potential. Since its high on Sep. 28, the U.S….
