American Express (AXP) – bought @98, it went up to $125 in 4 weeks and to $151 in 12 weeks = 27.6% and 54% return respectively

We recommended the stock back in October as a great long-term value play, and as one of our favorite picks in the Financial Transaction Services industry. We noted that the price was facing strong resistance around the $97 mark and that a break above that level would serve as a great buying opportunity for our followers. We recommended for our clients to wait for the break before committing fully to the stock and opening their long positions. The anticipated break to the upside occurred shortly thereafter and stock moved 27.6% and 54% higher in 4 and 12 weeks respectively. The stock is part of the XLF, which tracks an index of S&P 500 financial stocks, weighted by market cap. XLF offers efficient exposure to the heavyweights in the US financials segment. Its cap-weighted, S&P 500-only portfolio means that it’s concentrated in large banks and avoids small-caps. For many investors and traders, XLF has been the go-to ETF for financials exposure, although there are more comprehensive funds out there for long-term exposure. Through our correlation-confirmation approach we compared XLF’s price performance to the XLI Industrial Select Sector SPDR ETF, and used the strong and positive 10-year correlation of 87 % between the two indices in order to validate our market recommendations.

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