The S&P 500 took a breather in November, but it was still possible to pile even bigger gains to your already impressive pile this year.
XHuge November gains in leading stocks like Qualcomm (QCOM), Nvidia (NVDA) and Advanced Micro Devices (AMD) helped make up for the S&P 500's 0.8% fall in the month.
And picking stocks right in November added to awesome gains this year. Had you invested $10,000 in January and reinvested your money into the top stock currently in the S&P 500 each month this year, including Qualcomm in November, you'd have an eye-popping $313,806 now, says an Investor's Business Daily analysis of data from S&P Global Market Intelligence and MarketSmith.
That's a powerful 11-month gain of 3,038% from holding 11 stocks. That handily beats the impressive rise in the S&P 500 this year so far. That S&P 500 rise turned a $10,000 investment into $12,158. The S&P 500's 0.8% drop in November — is its fourth lowest monthly change all year.
Hindsight is 20/20. And clearly, few if any investors could have pulled off picking the top S&P 500 stock each month as it's not a repeatable strategy like this is.
S&P 500 Tech Stocks Turn On In November
Finding a top stock in a tough November wasn't obvious. More than two-thirds the stocks in the S&P 500 dropped in the month. And yet, some big gains were out there. More than 20 stocks in the S&P 500 jumped 10% or more during the month.
All the talk about a rotation out of tech stocks ran out of steam in November. The S&P 500 tech sector bounced back to life.
Upward of 80% of the top 10 performing S&P 500 stocks in November hail from the information technology sector. And it's not just due to a handful of lucky tech stocks. The Technology Select Sector SPDR ETF (XLK) jumped more than 4.4% in the month of November. That's not just higher than the 1% fall in the month by SPDR S&P 500 ETF (SPY). But it's the highest gain during the month of any of the 11 S&P 500 sectors.
Qualcomm, a maker of chips mainly for mobile devices, is a case in point. It's the top-performing stock in the month of November. It's up more than 35% in the month. And fellow chipmaker, AMD, is just behind with a monthly gain in November of nearly 32%. Both are benefiting from a global shortage in chips due to off-the-charts demand plus supply-chain logjams. Should you buy Qualcomm stock now?
Looking Back At A Moneymaking Year For The S&P 500
Turning your $10,000 into more than $300,000 this year, too, involved a whole host of S&P 500 sectors. This is a testimony to how broad the rally this year has been.
Of the top 11 stocks each month, four hail from the information-technology sector. That's more frequent representation than any of the 11 S&P 500 sectors. But tech is not from running away with leadership. Energy stocks came in No. 1 during two months of this year, not surprising given the huge run-up in energy prices. Coterra Energy (CTRA), for instance, bucked a down market in September and jumped nearly 37%. And another two months saw health care stocks race to the top.
But all told, it's an inclusive market for S&P 500 investors so far. Just this year, investors are up $8.8 trillion, says Wilshire Associates. And roughly half the stocks in the S&P 500 rose in November. And if history is a guide, the S&P 500 is just getting started. December historically is the third best month of the year, say Stock Trader's Almanac. There's also a "Santa Claus" rally to look forward to.
Top S&P 500 Stocks Each Month In 2021
Being in the right stock each month turned $10,000 into $319,356
| Month | Top S&P 500 Stock | Symbol | Stock Monthly % Gain | Sector | S&P 500 % Monthly Ch. | Beg. Bal. | Cumulative Value Of $10,000 Investment In January Reinvested In Top Stock Each Month | Composite Rating |
|---|---|---|---|---|---|---|---|---|
| January | Discovery, Inc. | (DISCA) | 37.7% | Communication Services | -1.1% | $10,000 | $13,770 | 32 |
| February | Marathon Oil Corporation | (MRO) | 53.3% | Energy | 2.6% | $13,770 | $21,109 | 86 |
| March | Nucor | (NUE) | 34.2% | Materials | 4.2% | $21,109 | $28,329 | 97 |
| April | Equifax | (EFX) | 26.6% | Industrials | 5.3% | $28,329 | $35,864 | 84 |
| May | NortonLifeLock | (NLOK) | 28.0% | Information Technology | 0.5% | $35,864 | $45,906 | 82 |
| June | Biogen | (BIIB) | 29.5% | Health Care | 2.2% | $45,906 | $59,449 | 21 |
| July | Moderna | (MRNA) | 50.5% | Health Care | 2.3% | $59,449 | $89,470 | 75 |
| August | Paycom | (PAYC) | 22.2% | Information Technology | 2.9% | $89,470 | $109,333 | 89 |
| September | Coterra Energy | (CTRA) | 36.9% | Energy | -4.8% | $109,333 | $149,676 | 99 |
| October | Enphase Energy | (ENPH) | 54.5% | Information Technology | 6.9% | $149,676 | $231,250 | 99 |
| November | Qualcomm | (QCOM) | 35.7% | Information Technology | -0.8% | $231,250 | $313,806 | 98 |
Sources: IBD, S&P Global Market Intelligence
Follow Matt Krantz on Twitter @mattkrantz
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