Investors are gearing up for some fun times.
The PEJ entertainment and leisure ETF, which holds Disney, Airbnb and Live Nation, hit a record high on Thursday for the third day in a row. It has risen 32% in 2021, more than six times the gains for the S&P 500.
One of the high flyers has been AMC Entertainment, buoyed by interest from retail and Reddit investors. That stock has climbed 385% so far this year.
Danielle Shay, director of options at Simpler Trading, said it would be wise to wait on some of the names.
“I would caution investors. Don’t bite up at the highs. You can look at hot stocks within this overall ETF and try to find ones that are pulling back right now,” she told CNBC’s “Trading Nation” on Thursday.
One name Shay does recommend is Chipotle, up 10% so far this week but underperforming the S&P 500 overall in March.
“Chipotle has seen a really nice pullback. Chipotle has been strong throughout the pandemic which leads me to believe that once everything opens up again, it’s going to be even stronger after the fact,” Shay said.
Steve Chiavarone, portfolio manager at Federated Hermes, said federal fiscal policy should support consumer spending as the economy reopens.
“With all the stimulus that’s in the system, consumers are sitting on roughly $3 trillion in excess savings. They’ve got a pent-up demand that they’re going to deploy, so we expect to see folks take longer…
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