The stock market's hot streak to start 2023 may be due for a cooling off, based on a warning signal that was recently triggered. Eric Johnston, Cantor's head of equity derivatives and cross asset strategy, pointed out that investors are abandoning safe stocks for risky ones at a rate that has marked past tops in the S & P 500. He noted that the Dow Jones U.S.
High-beta names, meanwhile, tend to be riskier and more volatile but can lead to greater returns than the broader market in an uptrend. "There has been a scramble for high beta stocks as investors look for what can move higher next and get the most leverage possible to a up move," Johnston wrote. The S & P 500 is up 14% year to date, on track for its biggest first-half performance since 2021.