Stock market tip September 2024 (after Fed reserve rate cut 0.5%)

The USA federal reserve cut the rate by 0.5%. I am taking a cautious approach to large (magnificent 7) US stocks however and especially Tech stocks.

This means I am reducing my USA Tech exposure (XLKQ and IITU). I see finance companies (esp. credit card/lending) doing well in next 6 months and also Energy companies seem quite cheap just now. I am DCAing into world index instead of USA tech.

I have updated my ETF tip blog article with this note:

Update 21/9/2024 - Fed 0.5% rate cut happened which gave approx 1% rise to S&P. Smaller companies should now begin to do better as they will pay less interest on borrowings and can expand. The S&P600/small cap is a good bet now - e.g. ISP6 (2 divs/yr) or USSC (acc - heavier in financials which is good) or invest in both as their top 10 don't overlap. Also Financials (WFEG or XLFQ or UIFS) and Energy (IESU) seem good.

My core ETF XDEQ holding has not performed very well this last 6 months compared to the benchmark SWDA (XDEQ 1yr performance was better than SWDA), however, XDEQ has top holdings in Visa, Mastercard, Nordisk, Costco and ASML, so I expect XDEQ to outperform SWDA in this next 6 months.

N.B. This is not investment advice and I am just a random guy on the internet! Please do your own research before investing.

P.S. On 20 August I tipped gold (SGLN) as perhaps a good hedge, it is currently up 2% (probably more good luck than judgement though!).

P.P.S. I sold SGLN in early October as I don't see it going up much more compared to finance/energy/world quality/small market.