Bill Baruch's Portfolio Moves: Trimming Small Caps, Buying Materials ETF & Tesla

Small Cap ETF Adjustments

• 📉 Bill Baruch is trimming his position in the iShares Russell 2000 ETF (IJR), which tracks small-cap stocks.
• ⚠️ The rationale is that IJR has underperformed the iShares Russell 2000 Growth ETF (IWM), and the case for small caps weakens if rate cuts are not front-loaded.
• 📊 While still seeing a case for small caps, Baruch believes capital is better allocated elsewhere at this moment.

Investment in Materials ETF

• 🚀 Baruch has initiated a position in the Invesco Materials Sector ETF (IYM), citing a significant breakout on its chart.
• 💡 This ETF includes miners, chemicals, and companies like Freeport-McMoRan, and he anticipates it will be a strong performer through 2026.
• 📈 He plans to increase his allocation to IYM, especially if the ETF retests its breakout level.

Tesla and Software Stock Moves

• ⚡ Baruch acknowledges selling Tesla in November but notes its strong momentum and recent pullback after Nvidia's AI platform announcement.
• ✅ He sees Tesla as a key name to help stoke a breakout in the S&P 500 and has bought back into the stock.
• 📉 He sold McDonald's, finding its chart lukewarm and needing cash for Tesla, and also sold Workday due to its underperformance and potential to break new lows.

Market Commentary on Software Stocks

• ⚠️ The discussion highlights the challenges in the software sector, with Workday specifically mentioned as being at 52-week lows.
• 🧐 Some select software names like Snowflake are still favored by certain analysts, but the general sentiment is cautious, with many underperforming stocks potentially deserving their declines.
• 📈 Oracle is noted as an interesting stock, showing a slight upward move above $200.