(3-minute read) I make it a point to follow what billionaire David Tepper does. And today, he's investing in one hated group of stocks.

February 18, 2021 Sometimes It Pays to Buy Hated Stocks By Brian Christopher, Editor, Profit Line Follow Brian    Dear Loyal Reader, David Tepper left Goldman Sachs to found the Appaloosa Management hedge fund in 1993. He still runs it today. He also owns the Carolina Panthers NFL team. Tepper knows how to find value. And he’s a billionaire as a result. My favorite example is the “Tepper Rally” he started on CNBC in September 2010. He simply pointed out the fact that the Federal Reserve’s quantitative easing was good for stocks. (Sounds simple now, right?) His fund had normally focused on bonds. But he told the anchors that day: “What, I'm going to say: ‘No, Fed, I disagree with you, I don't want to be long equities’? … We're a bond place, but we changed up to a little bit more equities recently.” I saw him live on TV that day. The S&P 500 Index was up more than 2% by the close. It rose nearly 20% over the next five months. Old dogs can learn new tricks. We should all try to follow Tepper in that respect. When the facts change, strive to change your mind. The S&P 500 is up 323% since Tepper started the rally. Forbes says his net worth is now $13 billion. I make it a point to follow what he does. And today, he’s investing in one hated group of stocks. Read on to learn more… From Our Friends at Crowdability. Did Elon Musk Create the No. 1 Investment for 2021? This breakthrough from tech genius Elon Musk could completely transform your portfolio and profits in 2021. (HINT: This has nothing to do with Tesla or anything else you've likely seen before — but it could change your world forever...) Click here now to see Elon's biggest breakthrough yet! The Setup The S&P GSCI Index was the first major investable commodity index. Its value was more than 50% of the S&P 500 during its 1984 and 1990 peaks. The market has shunned commodity stocks since then. Today, the value of GSCI is less than 5% of the S&P 500. (Source: Bloomberg, internal calculations.) This chart shows the GSCI divided by the S&P 500. The lower it is, the more hated commodites are relative to the broader market. Today, the GSCI is worth about 4.4% of the S&P 500. That’s low, but it’s up from the bottom. The relationship bottomed in September 2018 at 3.6%. Commodities are making a comeback. That is our opportunity. And David Tepper has already pounced. In the fourth quarter, he added eight new energy positions to his equity holdings. Of his four existing energy positions, he added to three and left one the same. Energy comprised 53% of the new positions he took last quarter. And thus far, it’s been the right thing to do. The average return quarter-to-date for these names is 21%. The S&P 500 is up 5% over this span. What to Do Now The lesson here is: Things can get cheap enough. Tepper knows that. He didn’t buy energy stocks because he loves carbon or hates the Earth. His focus is on making money. I suggest you look into shares of energy stocks today. Heaters are running full blast in the U.S. due to this nasty winter weather. Tepper’s largest energy exchange-traded fund (ETF) holding is the Energy Select Sector SPDR Fund (NYSE: XLE). As the world goes back to work, its growth should continue. You should know that this fund’s top two holdings are Exxon Mobil Corp. (NYSE: XOM) and Chevron Corp. (NYSE: CVX). They make up 44% of the ETF. And they will benefit from a crude oil price above $60 a barrel. Good Investing, Brian Christopher Editor, Profit Line The Holy Grail of Investing (5 Stock Ideas Inside) How Could We Have Beaten the Best Investor on the Planet? Size Does Matter When Buying Stocks WATCH: Trillion-Dollar Secret Tech Revolution     Privacy Policy Smart Profits Daily, P.O. Box 8378, Delray Beach, FL 33482. To unsubscribe from Smart Profits Daily emails, click here. 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