Investors are preparing for fun times.
The PEJ entertainment and leisure ETF, what counts Disney, Airbnb and Live nation, reached a record high for the third time in a row on Thursday. It’s up 32% in 2021, more than six times the profits for that S&P 500.
One of the high flyers was AMC Entertainment, borne by the interest of private investors and Reddit investors. That stock is up 385% so far this year.
Danielle Shay, director of options at Simpler Trading, said it would be wise to wait for some of the names.
“I’d caution investors. Don’t bite the highs. You can look at hot stocks within this entire ETF and try to find the ones that are pulling out,” she told CNBC.Trading nation” on Thursday.
One name Shay recommends is Chipotle, up 10% this week, but worse than the S&P 500 overall in March.
“Chipotle has had a really nice withdrawal. Chipotle has been strong throughout the pandemic, which leads me to believe that anything that opens again just gets stronger in the aftermath,” Shay said.
Steve Chiavarone, portfolio manager at Federated Hermes, said federal fiscal policies should support consumer spending when the economy opens again.
“With all the momentum in the system, consumers are sitting on over $ 3 trillion in excess savings. They have a pent-up demand that they will provide, and we expect people to take longer vacations and keep going more Travel, visiting families they hadn’t seen a year earlier, and reallocating their budget to leisure and entertainment, stocks in this space will continue to benefit for quite a while, “he said on the same segment.
Another stock, Airbnb, could benefit from consumer desire for travel, according to Chayvarone.
“It’s a growth stock, it’s a very popular stock, and maybe it doesn’t really make sense where it’s trading, but the fact is, people are buying it and people are using Airbnb. I think Airbnb … in the near future Future will continue to rise, “said Shay.
Airbnb was one of the top performers in the PEJ ETF on Thursday, up nearly 8%. It trades with a 24x price-performance ratio. In comparison, the S&P 500 is traded less than three times.
Disclosure: Shay holds ABNB.