What 71 Million New Investors and You Should Be Chasing, And It’s Not Your Tail
If you’ve turned on your television lately, you’ve seen the headlines and maybe read some of the analysts’ reports spreading doom and gloom. The rapid spread of omicron and stories about slowdowns, shutdowns, and lockdowns have all but dominated the headlines. You’ve been told to expect higher inflation, rising interest rates, falling company earnings, and peak valuations across the stock market.
At this point, some investors are running for the hills and putting all of their money into gold bullion.
Fortunately for us, we know something that the financial media doesn’t know.
While some may be running from the markets, they’re about to be crushed by some 71 million new investors who aren’t afraid of anything. These investors are going to plow so much money into the market that they’re actually going to propel the S&P 500 300% higher, maybe more, in the next seven years or sooner.
The media and analysts don’t see what’s happening below. They’re trying to stoke fear where there is none. They don’t see what we see. And they don’t know what we know.
Demographics move markets. I’ve been beating that drum for years. And this next round of generational investors is the largest we’ve seen in decades.
New investors, some 71 million of them, are coming into the market. And they’re collectively far more important than any earnings, profit margins, or net income measures.
“They” are the millennials. And there are 71 million of them ranging from 27 years old to 44 years old now. They are starting to enter the equity universe.
And believe me, nothing moves stocks and markets higher like more buyers than sellers.
This isn’t some fringe belief either. It’s been corroborated by the finest researchers on Wall Street.
Just ask researchers John Geanakoplos of Yale University, Michael Magill of the University of Southern California, and Martine Quinzii of the University of California, Davis. Their report, Demography and the Long-Run Predictability of the Stock Market, supports what we know. They found that population booms around the 30s to 50s correspond to stock market booms.
More investors entering the stock market means a better chance for a bull market.
You probably didn’t know it, but we’re entering one of those “bull market periods” now, right on top of the raging bull market we’ve been enjoying since 2009.
The rationale is simple: stocks are now the principal vehicle for retirement-headed people who start thinking about investing in their future when they’re in their 30s and 40s. That’s where Millenials are right now.
So then, if Millenials are going to move the markets, we need to know where they will invest. What’s important to them and how they see the world and their future will give us a clue where that money will flow.
Because millennials are incredibly sophisticated, they’ll invest in future shock companies. Companies like Pfizer and Moderna and the Tesla’s and Nio’s of the world fit this here.
Because they’re technology savvy, they’ll invest most of their money, if not all of it, in tech companies – names like Microsoft and Google, or in Nvidia and Apple.
Because they’re immune to traditional marketing and sales, they’ll invest in new paradigm retail companies that market to audiences in new ways like Amazon, PayPal, and Alibaba.
And because they not only grew up with it all and have been exposed to it since childhood, they’ll buy dips. They’ll play momentum trends. They won’t be afraid to swing for the fences – Redditors on Wall Street Bets today, seasoned investors with experience in a year or two.
That’s why they’ll buy winner stocks like all those mentioned above. These 71 million new investors will chase these stocks a lot higher, just as they do their dreams.
And alongside it, you can expect the S&P 500 to shoot up 300% over the next seven years or sooner.