in the Finance-Investment Management group either recently shaped
or appear to be shaping first-stage bases.
A rising stock will interrupt its advance to consolidate,
ideally shaping a base. Breakouts from the first or second
consolidation work better than those from later
So the first-stage base is a good thing. Also, any kind of a
base is relatively rare right now. As The Big Picture pointed out
in Wednesday's IBD, "today's buy opportunities are in pullbacks
to the 10-week or 50-day moving averages."
The recent minor pullback in the market was too brief to give
most stocks a chance to form new bases. Yet many of the
investment-management stocks are far along the base-building
The money-manager stocks started declining in early to
mid-January, bottomed in early February and then either moved
sideways or worked on the right side of a base. The action leaves
some in position for a breakout.
Some may object that breakouts are irrelevant to the income
investor, who buys with the idea of holding. However, everybody
can see the value of gaining an early cushion via a successful
breakout. Only gains make a stock easy to hold.
T. Rowe Price Group (
) is one of the investment-management stocks now near a new high.
The 10% deep, first-stage base could offer an entry at 84.51. The
annualized dividend yield is 2.1%.
) is approaching a 326.10 buy point in a first-stage base. The
cup is about 13% deep. The yield is 2.4%.
State Street (
) is about 9% off its high in a first-stage consolidation. It has
more right-side work to do. The yield is 1.5%.
Brookfield Asset Management (
) recently cleared a 40.92 buy point for a second time. The first
stab in late February led to a 5% correction. The most recent
stab came in low volume. The stock remains in the 5% buy zone.
The yield is 1.9%.