Well, hello!

Time for another edition of Trade Secrets, our weekly newsletter about The Globe and Mail’s stock market competition, Trade Off.

I just returned from the New York Stock Exchange, where we celebrated the three-billionth view of Ticker Take content since launching in fall 2024. One of the common threads between the Trade Secrets newsletter and Ticker Take is our dedication to keeping the market conversation simple. Investing is not always easy, but Wall Street speak can make it feel more complicated than it is. I hope your experience participating in Trade Off has helped you to feel more comfortable with the stock market.

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A reminder that one of the most fun parts of Trade Off is the ability to team up with friends and colleagues. This season, we have dozens of active groups, many sporting hilariously creative league names. If you’re curious to see what they’re respectively putting in their portfolios, just check out the Leagues section.

Player “AAA KJMJ AAA” – who finished last week in fifth place – posted the biggest weekly gain with a portfolio of mostly tech stocks, including Advanced Micro Devices, Oracle, AppLovin and Broadcom. Those were smart picks in a week when shares of many tech firms sharply rose as investors appeared to adjust to the constant uncertainty of the Iran war.

One of the big things I’ve learned about investing over the years is the resiliency of markets. A few weeks ago, uncertainty was thick in the air and the S&P 500 was nearing an official correction – that is, a decline of 10 per cent from its recent peak.

All in, the benchmark got pretty close to correcting, declining 9 per cent from its January high. The S&P/TSX Composite had a similar slump in a much more compact stretch during March. Those downdrafts, however, were followed by swift buying, highlighting the opportunity markets present if you accept volatility as being normal. Interestingly, Ben Carlson of Ritholtz Wealth Management crunched the numbers on S&P 500 corrections over the past 75 years. He found that if you bought stocks after a monthly drop of 10 per cent or more since 1950, returns averaged 15 per cent after one year, 42 per cent after three, and 72 per cent after five.

Obviously nobody knows the future. And there’s still too much geopolitical angst to suggest investor worries won’t return. But after the recent selling, several bulls have come out with rosy forecasts for second-quarter performance. Strategists at Wells Fargo Securities, for example, told clients last week the S&P 500 could reach 7,300 by July. That’s based on what they are calling a potential “three-month sugar high,” driven by the Trump administration’s tax policies, a possible pickup in U.S. manufacturing activity, tech companies monetizing their AI investments, and the World Cup being hosted in North America.

As you’re fine-tuning your portfolio, you’ve probably noticed there’s often more commentary on what to buy, rather than on when to sell. But understanding how professional investors sell their holdings is definitely valuable. This breakdown of one pro’s strategy from Brenda Bouw is worth a read.

Meanwhile, what is the “Rule of 10” and why is it a helpful way to consider picking stocks? Globe market strategist Scott Barlow explains.

Finally, many of you have smartly inquired about using ETFs to accomplish your investing goals. A reminder that The Globe and Mail has this tool if you want to find an ETF that meets your needs.

Thanks, as always, for reading. Good luck this week!

Jon

Jon Erlichman is the founder of Ticker Take on YouTube and a contributor to BNN Bloomberg.