If you still think you can't find winning stocks in the S&P 500, you're not looking hard enough. Investors paying attention to this market are still finding ways to make money.
All told, had you invested $10,000 in January and reinvested your money into the top stock currently in the S&P 500 each month this year, including Etsy in July, you'd have $76,175 now, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith. That's an impressive six-month gain of 660%. That's quite a feat in a year the S&P 500 is down 20% and has been brushing with a bear market all year. The same $10,000 invested in the S&P 500 would be worth just $8,000 now. That's a loss of roughly $2,000.
While these seven stocks jumped the most, the S&P 500 finally had a decent month. Despite being down 20% this year, the S&P 500 gained 7.6% in July. That's the first time in three months that the S&P 500 moved higher. And to date, the S&P 500 dropped in two of the past seven months.
Gaining In The S&P 500 Is Possible During A Bear
Hindsight is 20/20. And clearly, few if any investors could have picked out the top stock each of the past seven months, as it's not a repeatable strategy. But the staggering numbers are a reminder to investors that gains can be found in a bear market.
Three stocks in the world's most popular index, including online craft marketplace Etsy, information technology play Enphase Energy and Bath & Body Works, jumped more than 30% in July alone, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith.
And that offers a much-needed lift to markets. More than 400 stocks in the S&P 500, or roughly 80% of the index, gained in July. Still, the damage is done with nearly 80% of the stocks in the S&P 500 still down for the year.
Biggest S&P 500 Winners For The Year
Looking at the top stocks of July tells you S&P 500 investors are trying to find bargains.
Just look at Etsy. Even after a powerful 43% rally in July, the stock is still down 66% this year. The company's profit is seen falling more than 13% this year. But investors seem to think that's priced in. Instead they're looking forward to the company's profit in fiscal 2023 rising again, by more than 13% to $4.24 a share. Similarly, investors are trying to scoop up a value in mall-based personal care and beauty products seller Bath & Body Works. Shares are off 61%, even after a 31.4% gain in July.
In fact, just looking at the S&P 500's top stock during each month shows you how investors' attention has shifted during the year. January was all about energy, with Halliburton (HAL) jumping 34.4%. Investors loved energy for their inflation protection, low valuations and dividends. But energy excitement has eased. And that enthusiasm shifted to a hopeful rally in March, with a 3.6% rise in the S&P 500 and 56.4% jump in media marketing information company Nielsen Holdings (NLSN). That's the largest monthly jump of any stock all year.
And July brought some huge gains, too. We'll see if that's a fluke or the start of something new. One thing's for sure, though, ignore the market at your own risk as you might miss some big gains.
How To Turn $10,000 Into $76,175 In Seven Months
Top S&P 500 stock in each month of the year so far
| Month | Top S&P 500 stock | Symbol | Stock monthly % gain | Sector | S&P 500 % monthly ch. | Beg. bal. | Cumulative value of $10,000 investment in January reinvested in best stock each month |
|---|---|---|---|---|---|---|---|
| January | Halliburton | 34.4% | Energy | -5.3% | $10,000 | $13,440 | |
| February | SolarEdge | 34.1 | Information Technology | -3.1 | $13,440 | $18,023 | |
| March | Nielsen Holdings | 56.4 | Industrials | 3.6 | $18,023 | $28,188 | |
| April | 26.9 | Communication Services | -5.4 | $28,188 | $35,771 | ||
| May | Albemarle | 33.40 | Materials | -5.3 | $35,771 | $47,718 | |
| June | Dollar General | 11.40 | Consumer Discretionary | -8.4 | $47,718 | $53,158 | |
| July | Etsy | 43.30 | Consumer Discretionary | 7.6 | $53,158 | $76,175 |
