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The Catch-Up Trade

Jan. 05, 2022 1:07 AM ETIWM, IWN


  • Historically, a larger than 3 percent gain in the S&P in December is followed by solid January.
  • There is relative value between the S&P and the Eurostoxx, specifically in energy, financials, and semiconductors.
  • A relative value is a good portfolio strategy for 2022.
Euro Coins on Euro Union Flag Background

Vladimir Sukhachev/iStock via Getty Images

The January effect has started as the Santa Claus rally passed on the baton. The risk on tone was brisk, driven by strong manufacturing PMIs out of Europe. Up until last spring, the Eurostoxx outperformed the US in anticipation of a robust reopening across

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