First a message from our friends at The Oxford Club (sponsor) |
Dear Reader, |
America's big banks don't eat their own cooking. |
Let me explain. |
Your bank pays you 0.4% on your savings. Maybe less. |
At that rate, it takes 180 years to double your money. |
But here's what they don't tell you... |
BlackRock, Wells Fargo, and JPMorgan have been using a completely different account for themselves. |
One that has paid an average of 29% per year for the last 25 years. |
That's 72X more profitable than what your bank offers. |
72 times. |
They've quietly parked billions here... while tossing you scraps. |
Since 2000, this account has turned $1,000 into $556,454. |
It's never been advertised. Your banker never mentioned it. Your financial advisor probably doesn't even know it exists. |
But it's real. And it's been hiding in plain sight for over a century. |
Our Chief Income Strategist, Marc Lichtenfeld, calls it "The 29% Account." |
Marc's spent 20 years helping everyday Americans build income portfolios. He's a best-selling author. And he's one of the most trusted voices in our industry. |
When he brought this research to me, I knew we had to share it. |
Click here to watch Marc's full presentation on "The 29% Account." |
Sincerely, |
Rachel Gearhart
Publisher, The Oxford Club |
P.S. Marc reveals everything – what "The 29% Account" is, how it works, and how you can open one yourself. Click here to watch now. |
|
BONUS ARTICLE |
The S&P 493? |
The biggest story in U.S. equities right now isn't an earnings beat. |
It's breadth. |
For years, returns were driven by a narrow group of mega-cap stocks. Portfolio managers didn't need diversification—they needed concentration. |
Now the market is flirting with something different. |
The "S&P 493" — the rest of the index outside the mega-cap elite — is not just participating. |
It's leading. |
And that's not a vibe. |
It's measurable. |
|
Scoreboard: What Actually Changed |
1) Equal-weight is outperforming cap-weight |
When investors buy the Invesco S&P 500 Equal Weight ETF (RSP) instead of the SPDR S&P 500 ETF (SPY), they are explicitly choosing breadth over concentration. |
Current tape: |
RSP: $204.09 SPY: $689.43
|
The price isn't the story. |
The relative trend is. |
When equal-weight outperforms, it signals: |
|
That's regime-shift behavior. |
|
2) Flows confirm the shift |
In the week to Feb. 18, 2026: |
|
That's not accidental. |
That's institutional reallocation. |
|
3) Industrials and Financials are the transmission mechanism |
When the market rotates out of "long-duration narrative," it tends to rotate into: |
Real-economy throughput (Industrials) Balance sheet + earnings sensitivity (Financials) Durable non-mega-cap cash flow (Healthcare quality like GILD)
|
Let's break those buckets down. |
|
Bucket 1: Industrials — Throughput Over Theory |
Representative names: |
Caterpillar (CAT) Deere (DE) GE Aerospace (GE) Eaton (ETN)
|
Sector proxy: |
|
This is the market saying: |
"Show me backlog, capex, and physical demand." |
|
|
Caterpillar (CAT): The Bellwether |
From CAT's Q4 2025 / FY2025 report: |
Q4 sales: $19.1B (+18% YoY) Q4 operating margin: 13.9% (vs 18.0% prior year) Adjusted operating margin: 15.6% Q4 EPS: $5.12 (vs $5.78 prior year)
|
Current price: |
|
Cheap Investor interpretation: |
Margins are compressing. |
Yet the stock is strong. |
That tells you the market is paying for: |
Throughput Backlog visibility Infrastructure demand Physical asset leverage
|
Not short-term margin perfection. |
This is classic cycle pricing. |
|
Bucket 2: Financials — Earnings + Capital Return |
Representative names: |
JPMorgan (JPM) Bank of America (BAC) Goldman Sachs (GS)
|
Sector proxy: |
|
Why Financials work in breadth regimes: |
Less duration risk Earnings sensitivity to normalized credit Balance-sheet leverage to economic stabilization
|
When concentration fades, banks and brokers re-enter the conversation. |
|
Bucket 3: Non-Mega-Cap Quality — Durable Cash Flow |
This is where your framing correction matters. |
Gilead (GILD) isn't a Financial. |
It's Healthcare. |
But it fits the rotation perfectly. |
Gilead (GILD): Cash Flow Inside the 493 |
From FY2025 results: |
Total product sales: $28.9B HIV franchise sales: $20.8B (+6% YoY) Non-GAAP EPS: $8.15 (vs $4.62 prior year)
|
Current price: |
|
Cheap Investor translation: |
GILD is not a cyclical trade. |
It's a quality earnings re-rating. |
When investors say "S&P 493," they mean: |
"Show me earnings streams that aren't priced like AI duration bets." |
|
|
GILD qualifies. |
|
Why the Market Is Moving (Mechanically) |
1) Concentration Risk Is Becoming a Constraint |
At some point, portfolio managers ask: |
Do we keep adding to the same mega-cap names at elevated multiples? |
Or do we rebalance toward under-owned earnings? |
Early 2026 suggests: |
Broaden. |
|
2) "AI Immunity" Is Becoming a Theme |
Asset-heavy sectors — Industrials, Materials, certain Healthcare — are being framed as lower obsolescence risk. |
Caterpillar doesn't get disrupted by a software update. |
Earthmoving demand doesn't disappear because of a new model release. |
|
3) Duration Math Still Matters |
In higher-rate regimes: |
|
Industrials, Financials, and certain Healthcare names are anchored in current earnings power. |
That's a structural tailwind for the 493. |
|
Bull / Base / Bear Scenarios |
Bull Case: Durable Breadth Regime |
|
Winners:
CAT, DE, ETN, JPM, GS, GILD. |
|
Base Case: Selective Rotation |
Industrials outperform in pockets Financials require stable credit data Quality defensives hold as ballast
|
Stock selection matters. |
|
Bear Case: Head Fake |
|
Break signal:
Equal-weight starts underperforming again. |
|
Technical Overlay (Keep It Simple) |
CAT (~$759) |
|
GILD (~$151) |
|
XLI / XLF |
|
|
Cheap Investor Checklist |
Track this weekly: |
RSP vs SPY relative strength Value vs growth fund flows Industrials sector inflows CAT margin commentary and backlog trends Bank credit metrics (charge-offs, NIM, deposit beta) GILD HIV franchise growth durability Equal-weight participation breadth (advance-decline lines)
|
One red flag: |
If breadth narrows again and the "493" stalls while mega-caps resume dominance. |
|
Bottom Line |
The "S&P 493" rotation isn't anti-tech. |
It's anti-concentration. |
Industrials like Caterpillar are getting bid because they represent real demand and real asset leverage—even with margin pressure. |
Financials are back in play because investors are re-pricing earnings and balance-sheet frameworks. |
And quality cash engines like Gilead matter because the 493 isn't just cyclicals—it's durable earnings outside the mega-cap AI complex. |
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Investing involves risk, including the potential loss of principal. Always do your own research before making investment decisions. |
|
|
|
|
Tidak ada komentar:
Posting Komentar