Why the market pullback could turn into a correction, plus hideouts for investors: Amplify ETFS
it was another seesaw day on Wall Street
while stocks closed off the lows of the
session higher bond yields wait on
investors joining us now is Christian
magon amplify etf’s CEO Christian is
good to see you so uh you know Christian
we had the pullback but you say look out
this could actually turn into a
full-blown correction how come
Christian yeah I think you know the
market really is digesting what’s going
to happen with rates here and you know
we’ve taken a lot of cuts off the board
maybe one expected and and you know data
kind of is coming in hot here for the
economy which is I think pretty good uh
for a long-term for investor but for
investors betting on rate Cuts uh that
could cause some more issues in the
market so uh while we think this uh dip
could be a little bit more pronounced
than 34% maybe closer to 10% we think
this is probably a good longer term by
the dip situation because of course
we’re in a presidential election year
and some of those Cycles show that uh
you know the end of spring uh early
summer are weaker followed by a fairly
strong fall so we think this could be a
by the dip opportunity could get a
little rougher here but we do think
there are places to maybe hide out for
example okay so give us some of those
places where people can hide out and
presumably you’re talking about hiding
out maybe while this correction that you
see is is happening yeah that’s right
yeah and there’s different kind of forms
of that right so one of the areas that
we’ve seen do quite well in the last
month with the S&P down 3 4% is silver
and you know specifically uh silver
stocks so the S&P down you know 3 4%
we’ve seen our Junior silver miners ETF
SJ rally by 177% so about a 20%
performance difference just in the last
30 days between junior silver mining
stocks in the S&P really due to a couple
factors some of is the increased debt
burden um there’s been some reports out
about record uh silver use industrially
in
2023 uh yeah the price has risen on
silver uh but uh there’s probably we
think more to go there given the current
environment so we think uh looking at
those uh silver stocks may be a nice
little way to grab some Alpha here while
the general Equity Market tries to
digest kind of the future what about oil
Christian you want exposure there as
well yeah we think so uh you know oil
certainly is very volatile right now
given recent events um there’s a lot of
uh exogenous events affecting oil be it
GE geopolitical conflicts or even some
of the Cold War issues uh going on uh
with the US and the spr so we think
owning oil though is is a great thing
for investors to benefit from uh these
higher than average oil prices even
after we’ve come off the peak uh equal
larger profits for oil gas chemical
companies and um many of these companies
are pivoting and saying you know what
we’re not going to spend all the money
in R&D like we did in the past instead
we’re going to return Capital to
shareholders so they’re increasing their
dividends they’re doing Special
dividends stock BuyBacks so we think uh
looking at an air a portfolio of high
dividend yield uh oil gas chemical
companies uh Mak sense we have indiv and
div our natural resources ETF yields
well above 5% we think the yield could
be closer to 8 to 9% with special
dividends coming in later in the year
we’ll have to watch earnings for these
oil and gas companies to see but again
elevated oil prices are good for the
bottom line here and in this case really
helps with shareholder returns and then
you guys actually run um an Israel ETF
which uh you know seems like it would be
kind of a counterintuitive play right
now with the geopolitical risk yes it’s
definitely for a perhaps a more of a
longer term investor or contrarian
investor um portfolio uh this is itch
itq uh the Israel technology ETF from
amplifying Blue Star is a a fund that’s
been out for nearly N9 years it’s
averaged 9% a year average annual
returns going back to 2015 and it invest
in the companies that are really Innova
that are coming out of Israel and these
are cyber security artificial
intelligence clean energy uh agriculture
uh companies uh very cuttingedge
companies that are trading at a
meaningful discount right now uh because
of several of the things yes the Hamas
conflict but also before that there was
the judicial controversies in the
Israeli government and this has really
pushed uh these companies down now
there’re above where they were uh as of
the October 7th attacks uh but we think
they could be a great uh play for the
longer term investor if you look at
geopolitical conflicts in the Middle
East or Israel investors benefited from
buying the dip uh in Israel equities in
general and certainly even more so
looking at these technology companies so
we think itch is a great Savvy way to
get involved uh these companies are
trading at 11% discount to their price
to sales ratio over the last seven years
and again with the portfolio averaging
9% a year going back to 2015 average
annual returns we think buying this on a
dip makes a lot of sense for long-term
investors who want exposure to maybe
more moderately priced technology stocks
and are willing to stomach some of the
headline risk and increased volatility
that hopefully um will dissipate over
time so chrisan so uh silver oil in
Israel would putting together an
interesting portfolio uh give me I’ll
get you out of here this Christian give
me you know is there a sector though or
an asset you would avoid here
Christian well that’s a good question so
I I think um looking at the artificial
intelligence stocks here their
semiconductors uh is something that
you’d want to pair back from um they’ve
had a great uh run they’ve been they’ve
had tons of momentum and certainly we’ve
seen them drop off we think breath in
the marketplace is going to broaden and
if that’s the case uh less money will be
chasing these names more money will be
chasing maybe some of the higher quality
quality growth companies or other
sectors Beyond just technology in in in
Industries like semiconductors so we
think taking some of that exposure off
and looking at other areas that are
maybe more moderately priced that
haven’t had this in type of incredible
run makes a lot of sense here Christian
that was a great chat thanks for joining
the show appreciate it hey good to see
you thanks for having me
US equities (^GSPC, ^DJI, ^IXIC) close near their flatline at the end of Wednesday’s trading day as investors begin to price in the current earnings season. The S&P 500 has come down from its all-time high with some experts maintaining their high price target while others are beginning to raise their concerns.
Amplify ETFs CEO Christian Magoon joins Yahoo Finance to talk about whether the market could enter a correction soon and the ETFs his firm offers for the best trades in commodities and the dominating sectors in Israel.
Magoon offers this advice to investors should the market enter a correction: “One of the areas that we’ve seen do quite well in the last month with the S&P (^GSPC) down 3% or 4%, is silver (SI=F) and specifically silver stocks… We’ve seen our junior silver miners ETF SLIJ rally by 17%, so about a 20% performance difference just in the last 30 days between junior silver mining stocks in the S&P really due to a couple of factors…”
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